Do yourself a favor and avoid this situation all together by making timely monthly payments, keeping your contact information up-to-date, and alerting your loan servicer to any changes in your employment, as soon as possible.
Your lender will be much more willing to work with you if you are honest and take the initiative to make arrangements before things get out of hand.
If you have difficulty communicating with your private student loan lender, you may should contact the Consumer Financial Protection Bureau (CFPB) and ask for assistance or file a complaint.
If you have federal student loans, you won’t be considered in default until you are 270 days late on your payments.
Private student loans, on the other hand, are not so forgiving.
Each lender has its own rules determining when your loan is in default, and it could be triggered as soon as you miss one payment.
Once your loan has gone into default, many unpleasant things can happen.
This new loan will allow you to have one manageable monthly payment.
How do you know when it's time to talk to your lender about loan consolidation?
If you find yourself in any of the following situations a consolidation loan might be for you: Student loan consolidation offers students and graduates the opportunity to more successfully manage their debt obligations.
With a consolidated loan you can relive the stress of having a mountain of debt on your shoulders.
Graduate students, medical students and law students are carrying much more.
Consolidation loans have become common practice for both Federal and private student loan holders.
You may be required to pay your loan balance in full (immediately) or have your paycheck garnished, you could face staggering collection fees or have your tax refund seized, and you will definitely lose eligibility for any additional federal aid, including Pell Grants.