How to Make Payments on a Defaulted Student Loan

When you fail to make payments on a student loan, it eventually goes into default status, which means that you are seriously delinquent on payments. This appears on your credit report and damages your credit score. Plus, you might start to owe additional fees on your student loan. Unfortunately, a defaulted student loan will not go away on its own, and getting a student loan discharged in bankruptcy is rare. Therefore, the only way to remedy a defaulted loan is to begin making payments on it again.

Instructions

1

Look up the lender's name and phone number. You can find this on your most recent bill or by visiting the lender's website. If you do not know who your lender is, obtain a copy of your credit report through AnnualCreditReport.com. The report should list your student loan and the name of the lender.

2

Gather your financial information. This includes your recent pay stubs, bills for basic living expenses -- such as housing, food, transportation and childcare -- and your other student loan monthly payment amounts or the amounts you owe if you are in default on those as well. The lender will need this information to determine a reasonable and affordable monthly payment amount.

3

Call the lender, and ask to speak with a representative about starting to make payments on your defaulted student loan.

4

Ask about arranging a reasonable and affordable payment plan for getting your student loan out of default. When prompted, provide your financial information to help the lender determine a fair payment amount. The lender might ask you to enter this information on a form to submit online or by mail.

5

Ask the representative how to go about making payments. Each lender's policy is different. You can always send a check to the lender's billing department, and some lenders also process bank transfers, automatic monthly payments from bank accounts or even credit card payments.

6

Pay your agreed monthly payment amount by your preferred method each month. Your loan will generally be out of default after you have made nine monthly payments. At this point, you might be able to switch to a different payment plan and potentially lower your monthly payments.