Paying off student loans can be daunting for recent college graduates. It is important to try to avoid defaulting on student loans, as it can badly damage a consumer’s credit score.
ACCC offers 5 tips to avoid defaulting on student loans.
- Communicate with your lender
If you have financial issues, be upfront with your lender. They may be able to give you other options. - Ask about payment plans
There are several different payment plan options. Ask your lender about them. - Investigate payment postponement options
If you have a private loan, you can request a forbearance, which postpones payments up to a year if you cannot pay right away. - Research loan cancellation and forgiveness
Loan forgiveness varies through federal or state-sponsored programs. Research your options. - Dig out of default
If you already defaulted, call your lender to talk about rehabilitation programs or a customized payment plan.