Consequences of Default
If you default on your student loan, you face serious penalties including any or all of the following:
- Damage to your credit rating.
- Garnishment of your wages, also known as Administrative Wage Garnishment.
- Withholding of your state or federal Treasury payments (including federal tax refunds, Social Security benefits, etc.).
- Loss of professional licenses.
- Civil lawsuit.
- Liable for court costs/legal expenses.
- Loss of deferment entitlements and flexible repayment options.
- Loss of eligibility for further financial aid.
- Referral of your account to a collection agency.
- Liability for collection costs.
- Requirement to pay in full.
- Denial of employment by government agency.
- Hold placed on your official transcript.