If you're considering defaulting on your student loans, allow the good people here at Wealthy Geek to give you some advice - don't!
The long-term consequences of sticking your head in the sand and ignoring your student loan payments far outweigh the short-term benefits. Defaulting on student debt can cause some serious damage to the health of your finances.
Before we discuss exactly why this is such a bad idea, let's take a moment to define what it means to be in arrears on your student loans. In the United States, if you have not made any payments on your debt for 270 consecutive days, you are considered to be in default. Once that happens, the Powers That Be are free to seek compensation from you and your pocketbook.
Here are some highlights of what they can do:
To get yourself out of default, you are required to make 12 regular payments at the predetermined monthly rate. The good news is that once you do this, the record of your default will no longer be reported to the credit bureau.
Before you default on your student loans, make sure you have exhausted any and all options available to you, including deferring your payments or exploring different employment opportunities available for paying your debts down.