Options for Defaulted Federal Student Loans

If you got behind on your student loan payments and are now in default, don’t give up hope; you CAN get back on track!

You do have several choices for repaying a defaulted student loan:

• Repay your loan in full with a lump-sum payment.
• If you can’t pay your loan in full with a single payment, establish satisfactory repayment arrangements:
  • Reinstate your loan and eligibility for federal student financial aid if you are returning to school and need additional help paying for educational costs.
  • Rehabilitate your loan, removing it from default status and restoring your eligibility for deferments, forbearances, alternative repayment plans, and federal student financial aid.
  • Consolidate your defaulted loans to extend your repayment period and reduce your monthly payment.

Talk with your loan holder/servicer to decide what’s best for you.

If you are unsure about how to contact your loan holder/servicer, you may access your general loan history and loan holder/servicer information through StudentAid.gov with your FSA ID user name and password or by calling the Federal Aid Information Center at (800) 433-3243.

Also make sure that you communicate with all loan holders/servicers, to ensure that you address all defaulted loans.