One of the worst things that you can possibly do is to default on your student loan. With the options available and the low interest rates, there is no reason why borrowers should be in trouble with their student loan. If you have been unfortunate enough to default on your student loan, you have to take steps to make the situation right and move forward. How does one move forward after defaulting on a student loan? You have to talk with your creditors, whether they are federal or private lenders, and figure out a solution.
One of the things to consider after you default on your student loan is consolidation. It won’t be easy to get a company to sign off on a student loan consolidation, though. In order to qualify for one of these loans, you will have to have a cosigner go into the loan with you. If you have a family member who has enough good credit and faith in you to cosign a loan, then you should sit down with that person and explain your situation. You would still be responsible for the repayment of the loan under your consolidation terms, but your cosigner would also hold a shared responsibility.
Why did you default on your student loan? You have to consider the reasons why you got into this situation in order to make it better. Were the payments too large for your monthly income? Did you fall behind on payments because of irresponsibility? If you simply lacked the dollars to make the payments, then you need to consider a consolidation before applying for a stay on the loan or even deferment. If you need to produce more money to make the payments, consider lifestyle changes that will add to your personal coffers. You might even need to get another job. The most important thing you can do is get the loan back into the right.
Consolidation will take all of your Student Loans and combine them into one manageable payment. The consolidation will pay off your debt with the government or with private lenders and they will then become your current creditor. This is important because it will enable you to have some time to right your situation. In addition, you will be away from the stress of constant collection calls which can become a hassle and impact your life.
The most important thing to do when you default on a student loan is to take responsibility and make the situation better. By hiding from collection calls, you will only be making things worse. If you want to have any chance of salvaging your credit rating and being able to secure financing in the future, then you will need to take steps to get your loan out of default quickly. It may be embarrassing, but you might have to consult the people who you trust the most for some help. By cosigning a loan with you, they can help to bring your situation back into a positive light