The Difference Between Loan Default And Delinquency

When it comes to student loan debt, many questions automatically arise. Default and Delinquency are two common student loan terms often associated with student loan repayment troubles.

Student Loan Delinquency:
Student Loan Delinquency essentially means that you are behind on your student loan payments. Borrowers who remain delinquent for a specified period of time will soon have their loan declared by their lender as “defaulted”. This specified period of time, is typically 9 months for federal student loans, and for private student loans it is typically as soon as you miss a payment, but since private student loan terms vary, check with your specific lender. It is drastically important to avoid student loan default. If you have fallen behind (become delinquent) on your student loan payments, you should work with your lender to figure out your options for postponing payments or other forms of temporary relief.

Student Loan Default:
Once you have been delinquent on your student loan payments for a specific period of time, as stated in the terms of your student loans, the lender will declare your student loans as in default. Once you are in default, the entire loan balance will become due at that time. Most borrowers end up in default because of failure to make their loan payments, but make note that a lender also has the right to declare a default if you fail to meet other terms of the loan contract for the specified period of time, which is typically 9 months for federal loans, as soon as you miss a payment for private student loans, but double check with your specific lender.

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