Getting additional loans while consolidating

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To consolidate a defaulted federal student loan into a new Direct Consolidation Loan, you must either In addition, if you want to consolidate a defaulted loan that is being collected through garnishment of your wages, or that is being collected in accordance with a court order after a judgment was obtained against you, you cannot consolidate the loan unless the wage garnishment order has been lifted or the judgment has been vacated.If you choose to repay the new Direct Consolidation Loan under an income-driven plan, you must select one of the available income-driven repayment plans at the time you apply for the consolidation loan and provide documentation of your income.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.However, your credit history will still show late payments that were reported by your before the loan went into default.

Loan consolidation allows you to pay off one or more federal student loans with a new consolidation loan.

That cell of the table has now been corrected to indicate that loan consolidation will not result in removal of the record of default from the borrower’s credit history.

If you rehabilitate a defaulted loan, the record of the default will be removed from your credit history.

One way to get out of default is to repay the defaulted loan in full, but that's not a practical option for most borrowers.

The two main ways to get out of default are loan rehabilitation and loan consolidation.

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