Information for Defaulted Borrowers
What is default?
When you signed your promissory note and received your student loan(s), you made a legal commitment to repay the loan(s). If you failed to make payments for more than 270 days, your loan may have gone into default.
Unlike consumer debt, such as credit cards and car loans, there is no statute of limitation on collecting federal student loan debt. Interest continues to accrue on your debt and collection costs will also be added to your balance. The collection cost amounts may be as much as the U.S. Department of Education’s current maximum amount of 24.34% of the outstanding principal and interest balance per year. The loan must be repaid, even if you did not complete your program, you were unsatisfied with the level of educational services you received, or you were unable to obtain employment in your field.
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