As many college students are heading back to school this month, recent graduates are preparing to begin making payments on their student loans. While your student loan lender may allow a grace period following your graduation date, it is important to start taking action now to ensure you are prepared to meet your financial commitment. In fact, it is imperative that you do whatever you can to keep your student loan from going into default.
Defaulting on a student loan can have severe financial consequences. Not only can it result in the government garnishing your bank account or seizing your tax refunds, it can also negatively impact your credit score. Below are a few tips for making sure your student loan doesn’t go into default:
- Understand your repayment schedule. It is your responsibility to know when your first loan payment is due. You should make sure you know when and where to send your payments. This information should be available on your lender’s website. If you are not sure who the lender is for your loan, check the National Student Loan Data System.
- Understand grace periods. If you dropped some classes or you dropped out of school, it is important to make sure you understand how this impacts your repayment grace period. If you have a federal student loan, your grace period begins to run when your enrollment falls below half-time (which is defined by your school).
- Confirm you can afford the payments. During your grace period, you should create a budget and confirm that you will be able to afford your student loan payments. If you determine you will be struggling to make your payments, don’t simply ignore your student loans. You should immediately seek help in establishing a more manageable payment plan. In more dire circumstances, you may be able to obtain a deferment or forbearance.
- Default versus delinquency. Borrowers can be past due on their payments without being in default. Thus, if you have missed a few payments, your loan is delinquent but likely not in default. This means there are still steps you can take to prevent default.
- Rehabilitation. If your loan is in default, there is still hope. We can help you get your loan back into good standing through the rehabilitation process. Once you complete rehabilitation of your student loan, the default entry will be removed from your credit report.
If you have questions regarding your student loans, take action now to get the help you need!
Contact The “Milwaukee Bankruptcy Attorneys,” DeLadurantey Law Office, LLC for all your Chapter 7 and Chapter 13 bankruptcy needs. Whether you need debt negotiations or debt relief, or even foreclosure defense, DeLadurantey Law Office will handle bankruptcy matters for the following locations – Milwaukee, South Milwaukee, West Milwaukee, Waukesha City, Waukesha Town, Kenosha, Racine, and all other municipalities in Milwaukee County, Waukesha County, Kenosha County, and Racine County. DeLadurantey Law Office, LLC can be contacted by phone at (414) 377-0518.