If you can t pay your student loan, your lender can garnish your wages. The process of garnishment can cost up to 25 percent of your monthly income. And, it can last until you pay off your debt. Unlike credit cards and car loans, you can t have your loan forgiven. Defaulting on a student loan can severely affect your credit. Defaulted loans are on your credit report for seven years. If you can t pay your student loan on time, it could cause you to struggle to get other loans or rent an apartment.
If you re behind on payments, you may be subject to garnishments and late fees. You may also be disqualified from getting future student aid and even taking out credit cards. Defaulting on your student loan will affect your ability to get future financing for education and other financial endeavors. If you have a cosigner, he or she will have to make the payments. This will make it more difficult for you to qualify for future loans or refinance your existing loans.
If you don t pay your student loan, you risk losing your college or university degree, and your credit score will suffer. As a result, you must find a new way to make your payments. In many cases, delinquent loans can be renegotiated. Once you’ve reached a compromise, you can begin paying off your student loan and avoid the penalties. You don’t have to do this alone, though.
If you don t pay your student loan, you risk losing future student aid and even your ability to get credit cards or buy a house. If you don’t pay your student loan, the original lender can sell your account to a debt collection agency. The agency can begin harassing you, sending letters and garnishing your wages. If you continue to fall behind, your lender may even file a lawsuit to get you to pay the loan.
Not only will your credit score suffer, but you’ll also face a variety of financial consequences if you don’t pay your student loan. Depending on your lender, you could be charged with late fees or even see your tax refund withheld if you don’t make your payments. You can even lose your job. You can also lose your home. This is a big reason to make your payments on time.
If you fail to make your payments on time, your loan will become delinquent. Then, your loan servicer will report the delinquency to credit bureaus and you’ll end up owing money. By following the rules, you can prevent delinquency and keep your credit rating healthy. This will also ensure that your federal student loan does not go into default.