What are the Consequences of Defaulting on a Federal Student Loan?
Defaulting on a federal student loan comes with negative consequences that should be avoided if at all possible. What are Federal Student Loans? When reviewing the loans that you have taken out to help pay for your education, it is important to know which ones are Federal student loans. The most common Federal student loans are called Stafford, Perkins, or PLUS Loans. Federal student loans tend to have lower interest rates and better general terms and repayment schedules but the risk of defaulting on a Federal student loan is present if you have trouble making the payments. By understanding these loans you will be able to try to avoid the consequences of defaulting. The loan is considered to be defaulted after 270 days if the payments are supposed to be made monthly and after 330 days if the payments are supposed to be made less frequently than monthly. The Short and Long-Term Consequences of Defaulting on a Federal Student Loan After you have defaulted on a Federal student loan, the U
