What Can Happen if You Don't Pay Your Student Loans Back?
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Student Loan Delinquency
Student Loan Default
Student Loan Collections
Consequences of Not Paying Student Loans
Credit Score Impacts
Loss of Loan Benefits
Tax Refund Withholding
Social Security Garnishment
Suspension of Driver’s or Professional License
Can You Go to Jail for Not Paying Back Student Loans?
Ways to Make Your Student Loan Payments More Manageable
Student loan forgiveness: Student loan forgiveness programs, such as Public Service Loan Forgiveness, are available to eligible federal student loan borrowers. You must make 120 qualifying payments toward your federal loans, and meet the program’s other eligibility and employment requirements. Student loan deferment: Loan deferment temporarily pauses your required monthly payments. During this time, your loan will accrue interest, which is capitalized. Learn more about this repayment relief option in our student loan deferment guide. Student loan refinancing: A student loan refinance repays your original student loans, and creates a new loan. It can allow you to secure a lower interest rate. Or, it could offer a lower monthly payment by extending your repayment term; however, this means you’ll pay more toward your debt in the long-run. Always weigh the risks and benefits of refinancing a student loan based on your unique student debt situation. Income-driven repayment plans: Federal loan borrowers can request one of the Department of Education's income-driven repayment plans, which might reduce your monthly payment to as low as $0 if you’re eligible. he repayment period for income-driven repayment plans varies from 20 to 25 years. President Biden has announced the creation of the Saving on a Valuable Education (SAVE) Plan, which replaces the existing Revised Pay As You Earn (REPAYE) Plan. According to the White House, the SAVE Plan provides the lowest monthly payments of any IDR plan available to nearly all student borrowers. For more repayment strategies, read our guide to paying off student loans.
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