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What happens if I don't make my payments?
Default occurs when you fail to make payments when due or meet other terms of your promissory note. If you are experiencing difficulty in making payments, contact your lender immediately to work out terms so you do not go into default. There are serious consequences when you default on your student loan:
- Your loan becomes due and payable in full immediately.
- Your loan will be turned over to the Guaranty Agency for collection, which may have long-lasting consequences. Your loan balance will increase with added collection costs--up to 25%.
- Filing bankruptcy will not affect repayment of your student loans. You
are still responsible to make your payments as scheduled.
- You are ineligible for further financial aid, deferments, or forbearance.
- Default is reported to all national credit bureaus.
- The IRS is notified to intercept federal tax refunds.
- ND residents may have state income tax refunds intercepted.
- You are subject to legal action and may be responsible for collection costs.
- Post-judgement actions will be taken.
- Your wages can be garnished.
- The courts may suspend any professional license, certificate or permit you hold until you have made satisfactory payments.
In addition, you may be liable for collection costs, transfer fees, attorney fees, court costs, or other costs associated with the collection of a defaulted loan.
If your loan becomes delinquent during the repayment period, your lender and guarantor will contact you through letters and phone calls offering to help.
How can I avoid default?
Be sure your lender has your current address and phone numbers. Contact your lender as soon as possible on any changes, especially if you realize you will have difficulty making payments.
Repayment Options - What are they? Ask your lender about standard, graduated, income sensitive,
and extended repayment plans.
If you have questions about your student loan, call Student Loans of North
Dakota at
1-800-472-2166 ext. 5660 or you can check your account status online by clicking MY ACCOUNT.
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