Student Loan

Direct Loan
Student Loan Consolidation
Plus Loan (for parents)
Stafford Loans
Campus Based Programs
Federal Pell grants (Money that does not have to be repaid)

What are the consequences of defaulting?
Borrowers who fail to make a payment on time are considered delinquent on a Direct Consolidation Loan. Borrowers who do not make payments for 270 days are in default. Defaulting has severe and long-lasting consequences, as follows:

1. The Department of Education can immediately demand repayment of the total loan amount due.
2. The Department of Eduction will attempt to collect the debt and may charge collection costs.
3. The Department of Eduction reports defaults to national credit bureaus, damaging borrower's credit rating and, making it difficult for the borrower to make purchases such as a car or house.
4. Borrowers in default are ineligible for Title IV student aid.
5. Borrowers in default are ineligible for deferments.
6. The Internal Revenue Service can withhold a borrower's Federal income tax refund.
7. Borrowers' wages may be garnished.

It is important that borrowers stay in touch with the Direct Loan Servicing Center. Default can occur when borrowers fail to keep the Direct Loan Servicing Center up to date on address or name changes, causing billing statements to go astray. The Direct Loan Servicing Center can offer alternatives when borrowers have trouble making monthly payments. Borrowers may apply for a deferment or forbearance, or change repayment plans.

For more information about filling out the Free Application for Federal Student Aid (FAFSA) go to: www.fafsa.ed.gov/

Federal Laws
Major laws that govern financial institutions and protect individuals in their financial dealings

Organizations

Fannie Mae
Freddie Mac
Ginnie Mae
Nellie Mae
Sallie Mae

Consumer Info

Credit Bureau
Credit Report
Directory of Federal Agencies
Federal Trade Commission (FTC)
Identity Theft
Predatory Lending
Repair Your Bad Credit
Truth in Lending Act
Borrowers Beware

Miscellaneous

Private Mortgage Insurance (PMI)
Prepayment Penalty

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