Consolidating college loans tips Chet camsexs
Once you have made the required nine payments, your loans will no longer be in default.
To rehabilitate a defaulted Federal Perkins Loan, you must make a full monthly payment each month, within 20 days of the due date, for nine consecutive months.
You’ll need to provide documentation of your monthly income and expenses, including a completed form.
Depending on your individual circumstances, this alternative payment amount may be lower than the payment amount you were initially offered.
To rehabilitate your loan, you must choose one of the two payment amounts.
Your loan holder may be collecting payments on your defaulted loan through wage garnishment or Treasury offset (taking all or part of your tax refunds or other government payments).
However, your credit history will still show late payments that were reported by your loan holder before the loan went into default.
If you consolidate a defaulted loan, the record of the default (as well as late payments reported before the loan went into default) will remain in your credit history.
Involuntary payments may continue to be taken until your loan is no longer in default or until you have made some of your rehabilitation payments.You must provide documentation of your income to your loan holder.If you can’t afford the initial monthly payment amount described above, you can ask your loan holder to calculate an alternative monthly payment based on the amount of your monthly income that remains after reasonable amounts for your monthly expenses have been subtracted.Loan consolidation allows you to pay off one or more federal student loans with a new consolidation loan.To consolidate a defaulted federal student loan into a new Direct Consolidation Loan, you must either Note: If you choose to make three payments on the defaulted loan before you consolidate it, the required payment amount will be determined by your loan holder, but cannot be more than what is reasonable and affordable based on your total financial circumstances.