Do Defaulted Student Loans Expire?

To know about do defaulted student loans expire…read on this article…!

Numerous people are burdened by the student loans they must pay monthly, which is not an insignificant amount of money. Hence, it is not uncommon for some to miss their payment deadline due to being unable to pay their debt, and consequently, they end up defaulting on their loans.

Do Defaulted Student Loans Expire?

What is a Defaulted Student Loan?

Defaulted student loans are the consequence of frequently failing to pay your federal loan and it expire . The process of falling into default begins the moment you miss a payment. 

There are three stages of going into defaulting your student loans:

  1. The first day after missing a payment

Missing a due date of payment is considered a crime that will possibly charge you late fees.

  1. 90+ days after not paying

Your loan servicer discloses your account to the three main credit bureaus (Experian, Equifax, and TransUnion). Therefore, your credit score could be adversely affected since it will appear on your credit report.

  1. Around nine months (270 days) of missed payments 

After you reach 270 days of the past-due amount, you officially default your student loans, and your debts will go to collections agencies that buy your unpaid credit card debt. 

Consequences of a Defaulted Loan

Going into defaulted federal student loans results in severe repercussions. The federal student aid listed a few possible outcomes of defaulting your loans, some of which are:

  • Being disqualified from other federal benefits such as repayment plans, forbearance, and deferment.
  • Discontinuation of any further federal student aid 
  • Withholding tax refunds 
  • Withholding a fragment of your wages garnished to repay defaulted loan 
  • Risk of a lawsuit by the loan servicer to collect the debt 
  • Risking social security retirement perks 
  • Harming your credit score

Other consequences include:

  • A collection agency taking over your loans 
  • Having a bad credit history that lasts for up to 7 years after default repayment, toughens the process of gaining an auto loan, mortgage, or more credit cards.

Do Defaulted Loans Go Away?

It is logical to wonder if student loans will ever expire without having to repay them, but do they? While they might ‘disappear’ from your credit report after 7+ years of missing the first past-due payment, they did not go away. In fact, it merely indicates that they have been defaulted or taken over by a collection organization, and you still have to pay back your debt. That said, federal student loans can expire through:

  • Public Service Loan Forgiveness (after 10 years)
  • An income-based repayment plan (after a minimum of 20 years)
  • A 25-year federal loan forgiveness (after 25 years of borrowing loans for graduate school)

In addition to federal help, a person can be free of their loans if:

  • Their parent dies (Parent PLUS Loan Forgiveness)
  • The person suffers from a terminal or permanent mental/physical disability (Total and Permanent Disability Discharge)
  • The person teaches for 5 consecutive years in a Title I school district (Teacher Loan Forgiveness)
  • The person was in a delinquent school (Borrower Defense to Payment)

How to Get Out of Defaulted Loans ?

There are multiple ways to relieve yourself from student debts; consolidation, discharge, forgiveness, rehabilitation, and repayment.

Loan Consolidation

Consolidation is a process that offers those in debt to sign up their existing student loans into a new loan that they will be responsible for repaying. To explain, loan consolidation allows you to combine multiple loans into one big loan with a fixed interest rate. 

Loan Discharge 

Some circumstances, such as having a disability or misconduct, can lead to the government releasing the debted person from having to repay the defaulted loan. This means that the person is ‘discharged’ from their obligation to pay their debts due to being unable to pay. 

Loan Forgiveness 

Loan forgiveness is similar to loan discharge, the difference is that loan forgiveness is based on the borrower working in a specific occupation (usually community service) for a certain amount of time. Only loans directly given by the federal government are eligible for forgiveness. 

Loan Rehabilitation

Loan rehabilitation involves an agreement between the person in debt and the Department of Education. The consensus is a settlement on a lower alternative monthly payment that considers the person’s income and expenses. For this to apply, borrowers in default must make nine installments promptly (based on their salary) within ten consecutive months from the initial date of accordance. 

Successful rehabilitation lifts any defaults on the person’s credit history but does not erase the delinquencies. It is worth noting that a person in loan rehabilitation might still be unable to pay their debt if it is still more than their income, which might create further issues.

Loan Repayment

The most obvious solution to get out of debt is to repay your loan servicer, which can be achieved in several ways. To begin with, the borrower can go to the Department of Education and request them to direct the Department of the Treasury to hold back money from multiple federal payments, such as a person’s tax refunds. In addition, the Department of Education could collect the money from up to 15% of the borrower’s income. Lastly, you can look into raising the money through help from family members, friends, or a fundraising platform, such as GoFundMe.

How to Prevent Default

If you have not yet reached a loan default and want to avoid that from happening, here are several ways you can protect yourself and your future:

  • Borrow as little money as possible because the more you borrow, the higher the default rates will be.
  • Ensure that you fully comprehend your loan options and the responsibilities that come with it before going ahead and taking the loan 
  • Keep a spreadsheet of detailed information about your loans. For instance, register the name and phone number of the lender, the type of loan you took, the amount of money you borrowed, the increase rate, and their deadlines (or due dates). 
  • Try your best to pay your installments on time. The more precise you are when paying, the less likely you will get into default.
  • If you are unable to pay before the deadline, contact your loan servicer and notify them that you might be late for payment. This could help with building a good relationship with them which could stop them from filing a lawsuit against you. 
  • Consider reaching out to family members or friends to help with payment
  • Create a fundraising account and post it online. You would be surprised by the number of people willing to help total strangers. 


There is no doubt that getting into defaulted student loans is a serious issue that many people struggle with and expire. It is horrifying to think about the lawsuits that a loan servicer can file against someone incapable of repaying their debts. Nonetheless, there are various ways to prevent things from escalating, such as requesting loan forgiveness or discharge, applying for loan rehabilitation or consolidation, or paying the due amount, if possible. The most important thing is to try to be up to date with repaying your loans, and if that is not an option, you must reach out to someone that can help you.