Loan Default Status

Financial Aid

Financial Aid Loan Default Status

If you are in default status, it may be due to failure to make payments on your student loan, as scheduled according to the terms of your Master Promissory Note (MPN). The MPN is a binding legal document you signed at the time you took out your student loan.

The consequences of being in default status are as follows:

  • You will not qualify for any more federal student aid.
  • Your entire balance of your student loan(s) can be due immediately.
  • You may not be entitled for deferment, forbearance, or repayment plans.
  • Your student loan(s) will be reported as delinquent to the credit bureaus. This will damage your credit rating.
  • Your refund from federal and state income tax may be withheld to collect on your debt from defaulted student loan(s).
  • Your debt from your student loan(s) will increase because of the late fees, interest, court fees, collection fees, attorney’s fees, and any other costs associated with the collection process.
  • Your wages may be garnished through your employer.

To learn more about your Loans that are in a default status and clear your default status, you may contact your school, go to https://nsldsfap.ed.gov or call 1-800-433-3243 to resolve this issue.

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