Now, if you have multiple student loans managed by the same servicer, the effect of a missed payment even on one loan account could affect your other loan accounts. A single missed bill could therefore potentially put your other loans into delinquency or default.
Don’t ask me why. That’s just how these loan servicers do it.
To rub more salt on an open wound, when collection agencies take action to either collect or buy the defaulted loan, this will also show up in your credit history.
These marks will also be on your credit report record for 7 years.
So as you build your life in the aftermath of defaulting on your student loan, getting access to the best rates to buy a car, a house, getting credit cards, or personal loans will tough.
Sometimes, even renting a place could be tough if landlords also check your credit rating.
The best thing to do to avoid all these negative impact on your credit rating and your life is to honor and pay your student loans promptly.
Now, if money is really tight and you feel that servicing your student loan has become a major burden for you, I suggest that you reach out to your student loan servicer and inform them about your situation.
They usually have in-house counselors to help people in need and will give you the best advice on how to best deal with your situation and avoid a default on your loan.
Especially during tough times, you’ll find out that there are a lot of kind people in the world willing to help others in need. 💰