What are the consequences of defaulting on my student loans?

Defaulting on your student loans can have severe consequences in Washington. If you have a federal student loan, your loan servicer could seize any federal or state income tax refunds or state lottery winnings you’re entitled to and use them to pay off your loan. They can also garnish up to 15% of your paycheck to collect payments, report the delinquency to credit agencies, and take legal action to recover their money. If you receive a private loan and default, your lender won’t be able to garnish wages or tax refunds, but they can still sue you and (if successful) collect court costs, attorney fees and any other judgment related costs. Your student loan debt can also be sold to a debt buyer who may be more aggressive about collection tactics. Defaulting on your student loans also has a long-term effect on your credit score, making it harder to access credit in the future. This could impact your ability to get loans, rent an apartment, and even get a job. Therefore, it’s important to make sure you pay your student loans on time to avoid falling into default and suffering the consequences. If you have trouble doing so, make sure to contact your loan servicer to work out a payment plan or discuss other options.

Related FAQs

Are there any programs available to help me get out of default on my student loans?
Are there any grants or scholarships for students attending community college?
What is the current interest rate for student loans?
Are there any special programs or incentives to help me pay off my student loans?
Are there any special rules for postgraduate student loans?
Are there any special considerations for students attending for-profit colleges and universities?
Are there any tax credits or deductions for student loan payments?
What types of loans are available?
Are there any income-driven repayment plans available for student loans?
How do I determine my credit score and eligibility for student loans?

What are the consequences of defaulting on my student loans?

Related FAQs

Related Blog Posts