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Student Loans

 

Defaulted Loans

The collection unit of the Student Loan Department will place a hold on your account if it becomes delinquent. An account on hold prohibits registration, graduation, granting of credit, release of transcript, grades or diploma. Please note that your loan payments are due on the first day of each month. If you fail to submit a payment on time, your account becomes delinquent.

DEFAULTING IS BAD NEWS!
With very few exceptions, you are always legally required to repay your loan. Failure to do so can jeopardize your entire future. You can be forced to repay, and repayment after default is much more expensive than when you make timely payments. Defaulting on a loan is never an acceptable alternative.

WHEN YOU REPAY YOUR LOAN IN A TIMELY MANNER, YOU'LL BE ABLE TO:

  • Qualify for bank cards and other forms of credit;
  • Borrow for major purchases, like a new car or home;
  • Invest in the future; and
  • Have peace of mind.
IF YOU DEFAULT:
  • It will be reported to a national credit agency;
  • It could take years to clear your record;
  • Your car could be repossessed;
  • Your federal tax refunds could be seized;
  • Wages could be garnished;
  • Savings could be lost;
  • A court judgment could be rendered against you;
  • Your school academic transcripts may be withheld;
  • You could be required to pay the entire unpaid balance immediately, including interest, late charges and other costs such as collection costs;
  • Your student loan will be sent to an outside collection agency where you will liable for collection costs; and
  • Your loan could be assigned to the United States Department of Education for collection.
Remember: your dissatisfaction with, or non-receipt of, the educational services being offered by this or any other university does not excuse you from repayment of any of your student loans.

DEFAULTED LOANS ARE PURSUED TO THE FULLEST EXTENT OF THE LAW PER FEDERAL REGULATIONS. Defaulted loans are reported to a
national credit bureau.

COMMUNICATION...THE VITAL LINK
Many defaults can be avoided simply by staying in touch with the Office of Student Financial Services. Remember, it's your responsibility to repay your education loan(s). If you cannot be located, you could be declared in default, even without your knowledge. You should always contact Campus Partners if you:

  • Change your name, address, or phone number
  • Change enrollment status
  • Transfer to another school, or
  • Have problems making your loan payments on time.
It's a good idea to keep a log of all communications, including phone calls. Make sure you date correspondence. Be sure to keep detailed notes of phone calls and copies of all correspondence. Always include your name, address, phone number, and loan number on all communications.

The Federal Perkins Loan provides the opportunity of Loan Rehabilitation for defaulted loans.

 


Student Financial Services · Mary Martin Hall
Auburn University · Alabama 36849 USA
334-844-4634