What Happens If You Don't Pay Your Student Loans?

The 270-day default timeline, step by step

A federal student loan is delinquent from the day after you miss a payment, but it only enters formal default after 270 consecutive days without payment, per Federal Student Aid. At that point your loan transfers to the Department of Education's Default Resolution Group, or to a guaranty agency for older FFEL loans, and collection activity begins in earnest.

Credit bureau reporting starts well before the 270-day mark: your servicer typically reports a missed payment as delinquent after 90 days, and once you hit default, the Default Resolution Group reports it to Equifax, Experian, Innovis, and TransUnion around 65 days into that default status. That record can stay on your credit report for up to 10 years, which is a longer shadow than most other unpaid debts leave behind.

What the government can actually take

Two collection tools apply specifically to defaulted federal student loans, and neither requires the government to sue you first. Administrative Wage Garnishment lets the Department of Education order your employer to withhold up to 15% of your disposable pay directly, without a court order. The Treasury Offset Program can separately withhold your federal tax refund and certain federal benefits, including some Social Security payments, to apply against the defaulted balance.

Both tools came back into active use in 2026: wage garnishment resumed on January 7, 2026 after a multi-year collections pause, with the Department briefly pausing all involuntary collections again on January 16 while it worked through the backlog. Confirm your current default status and any active collection action directly on your StudentAid.gov account dashboard rather than assuming a past pause is still in effect, since policy on this has shifted more than once in a single year.

Collection costs and lost benefits

Once a loan is in default, the government (or its collection agency) can add collection costs on top of the principal and interest, and those fees can meaningfully increase the total balance you eventually have to repay. On top of that direct cost, default strips you of income-driven repayment plans, deferment, and forbearance, the exact tools that would have helped you manage the original payment trouble in the first place.

That combination is what makes default expensive beyond the credit score hit: you lose access to the flexible repayment options right when you need them most, while the balance itself grows from added fees. Acting before the 270-day mark, even a partial payment or a call to your servicer, keeps every one of those flexible options on the table.

Private student loans work differently

Private student loan default has no fixed 270-day federal standard; the specific trigger is set by your loan contract, and most private lenders define default after 90 to 120 days of missed payments, sometimes faster. Private lenders also cannot use Administrative Wage Garnishment or the Treasury Offset Program, since both are federal government collection tools tied specifically to federal loans.

A private lender can, however, sue you in civil court and pursue a court-ordered wage garnishment if it wins a judgment, which follows a slower legal process but can ultimately reach a similar outcome. If you're behind on a private loan, contact your servicer directly and ask about a hardship forbearance or a modified payment plan before a missed payment becomes a lawsuit.

Two ways out of federal default

Loan rehabilitation requires nine consecutive on-time, agreed-upon payments over roughly 10 months. Complete it and the default status is removed from your credit history entirely, which is the only path that erases the default record itself rather than just resolving the debt.

Direct Consolidation is faster, often resolving in weeks rather than months, but it does not erase the default from your credit history and it capitalizes any accrued collection costs into your new loan balance, meaning you pay interest on those fees going forward. If speed matters more than your credit history right now (an active wage garnishment you need stopped, for example), consolidation is the quicker fix; if a clean credit report is the priority and you can sustain nine months of payments, rehabilitation is the better long-term move. Either path starts with a call to the Default Resolution Group, not your original loan servicer, since that group now owns the defaulted account.

A worked example: what 270 days actually looks like on the calendar

Put the timeline on an actual calendar and the runway looks longer than it feels in the moment. Miss a payment due January 15; your loan is delinquent the next day, and your servicer typically reports it to the credit bureaus as a late payment around day 90, roughly mid-April. Default itself does not hit until 270 days out, around mid-October, nine full months after that first missed payment.

That nine-month window is not a reason to wait; it is the reason to act early, since every option (an income-driven plan, a deferment, a short forbearance) is still available for the entire stretch and disappears the moment default hits. A borrower who calls their servicer in month two has dramatically more options than one who waits until month eight, even though both are still technically pre-default. If you're already past day 270, run your own balance and a realistic income-driven payment through our budget calculator before your first call to the Default Resolution Group, so you walk in knowing what you can actually commit to for nine consecutive months.

Frequently asked questions