Consequences of Default
If a borrower fails to repay his/her student loan on a timely basis, he/she will be considered in default and may encounter the following consequences:
- Reporting to national credit bureaus, which may cause a negative effect on the borrower's credit rating.
- Assessment of late charges.
- Restriction of access to institutional records.
- The borrower may be ineligible to receive additional federal or state financial aid.
- The entire unpaid balance of the loan, including interest, may become immediately due and payable.
- Placement of the loan with an attorney or collection agency. Costs associated with the collection of any loan will be added to the amount owed.
- The borrower may be sued to force payment and may be liable for court and attorney fees if judgment is not in the borrower's favor.