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It happens more often than you think—students take loans with every intention of repaying them but life gets in the way and they struggle to pay back what they owe. If this happens to you, the worst thing you can do is sit back and see what happens.
In fact, letting your lender know is the very first thing you should do. Your loan will not just go away if you ignore it and your lender is not going to overlook it either. Worse still, if you do not do anything about it you will end up missing payments and hurting your credit score.
Informing the lender in advance that you are having a problem with paying the loan gives both you time to talk things over and agree to some kind of solution.
You should also explore payment plans and deferment options. Changing your plans is the best way to reduce your monthly payments without affecting your credit score.
Lenders who disburse federal loans are required to give borrowers deferment options as well as the ability to change their payment plans once a year. If you have taken a federal loan, you automatically get a 6-month grace period. You can apply for deferment after this period under certain circumstances—economic hardship, inability to find full-time employment, still pursuing a part-time degree or military service, among others.
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