Income-Driven Repayment Plan Forgiveness For federal student loans, the standard repayment period is 10 years. Loan rehabilitation allows you to get out of default by making 9 monthly payments within 10 months. A Loan Rehabilitation is a great way to get defaulted student loans back into repayment as long as you follow through with an income-driven repayment plan post-rehabilitation. Another way to get out of default on a federal student loan is to consolidate it. To find your servicer, log in to the Federal Student Aid website or call the Default Resolution Group if your defaulted loans have been transferred to a collection agency. That said, it’s never too late to resolve an old debt and get your student loans out of default. A federal student loan is considered to be in default if payments haven’t been made for 270 days. Combining your student loans through consolidation is a faster and cheaper way to get out of default on federal student loans than rehabilitation. If you are able to get out of default through rehabilitating or consolidating your loans, you will once again be eligible for the more flexible pre-default repayment options as well as deferments.. Most private lenders do not have programs that will get you out of default but some may be willing to refinance your loan. One option that’s available is a rehabilitation program. Explain your intent to resolve the default, explain your financial situation and ask if you qualify for rehabilitation. This means that you can get yourself out of default before your loans get sent to collections. 1 – Find Your Loans. Present documentation of income. Your private student loan may default if you miss just one or two payments -- or automatically, if you file bankruptcy or default on another loan. Perkins loans have different rules. Check out Student Loan Hero’s full guide on student loan default and how to … Your second option on how to deal with this situation is based on logic and the facts. If your private loan is in default, there's no simple prescription for dealing with the lender or collection agency. Consolidation can be a good option for getting out of default, as long as you’re able to commit to the repayment plans it requires. Getting Your Private Student Loans Out of Default. Many … There are three main options to get student loans out of default: repayment in full, consolidation, and student loan rehabilitation. Get on a Default Rehabilitation Plan ASAP There is an income-driven plan for paying off federal student loans in default. Enter a Loan Rehabilitation Agreement. There are typically three options for getting out of default: 1) pay the debt off in full, 2) consolidate your student loans and begin making payments, or 3) rehabilitate your loans. Click here to learn more and get the free map – before your next payment date!) You don’t have to pay fees to consolidate your loan, and consolidation should be completed in fewer than six months. Who do I contact to get started on a rehabilitation program for defaulted student loans? With federal student loans there are two realistic ways to get your student loans out of default and a third option that’s out of reach for most borrowers. One of the many reasons for consolidating federal student loan is simplifying the repayment process on … The Federal Student Loan Rehabilitation Program offers borrowers who have defaulted on their student loans a way to get out of default, and back into repayment, but it does something even better than that, because it also removes the default status from your credit report as well. Pay a new monthly payment based on 15% of your discretionary income. If you have not paid your federal student loans in 270 days, then your loan is officially in default and you qualify. You have to make 9 monthly payments within 9 months. If you do fall so behind that your loans go into default , there are options — especially if you have federal loans. Student loan refinancing. Unlike federal student loans, private student loans will typically have higher interest rates and your loan could be in default after 120 days or 4 months of missed payments. Your student loans most likely ended up in default because you did not make payments for a long period of time–typically 270-360 days. If you have federal student loans, you may be able to consolidate your student … Loan Consolidation Here are two questions on the subject that we recently received from readers. After a number of monthly, on-time payments, your loan will be out of default. Getting out of default — or avoiding a default student loan altogether is key. So, getting out of private student loan default is very different compared to federal loans. The two main post-default repayment programs for government loan borrowers are consolidation and rehabilitation. Getting your student loans out of default will require the borrower to be proactive and take action to get back into good standing. Read on for the top two strategies for getting your federal student loans back into good standing. Do I qualify for a student loan rehab? You should also understand that there may not be a "quick fix" in either case. The rehabilitation plan for default allows you make payments based on income. The first thing you need to do is re-track down your student loans. I chose to rehabilitate my loan. Your servicer will ask for a document like a tax return or a pay stub. Private student loan lenders typically have none of the second chance programs to get your loan out of default like federal student loans do. Two options available for postponing repayment of your student loans are deferments and forbearances. How to Use the Federal Student Loan Rehabiliation Program to Get Your Loans Back on Track! 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