A Prospective Student is Ineligible for Financial Aid Because of a Student Loan Default
August 01, 2011
It is a good idea to get a copy of the full payment history on your loans to make sure there were no errors by the lender, such as missing payments. You can get a copy of the payment history from the student access interface to the National Student Loan Data System (NSLDS). If there are any missing payments, provide proof of the payments to the holder of the loan, such as a copy of the front and back of a canceled check.
If you are unable to regain eligibility for federal student aid, you may find it very difficult to afford college. Sometimes, though, students who have defaulted on their loans are able to afford to pay for tuition and fees at a lower-cost college, such as a community college, without relying on financial aid.
Note that students who have defaulted on their federal student loans are still eligible for the Hope Scholarship and Lifetime Learning tax credits. The Hope Scholarship tax credit is partially refundable, so you should be able to qualify even if you don’t have a tax liability.
The US Department of Education’s Default Resolution Group (DRG) can help borrowers explore options for rehabilitating defaulted student loans and regaining eligibility for federal student aid. The DRG may be reached by calling 1-800-621-3115 (TTY 1-877-825-9923) or by sending email to firstname.lastname@example.org.
For additional information on rehabilitating defaulted federal student loans, visit Student Loan Rehabilitation on the FinAid site.
Need money to pay for college?
Every semester, Fastweb helps thousands of students pay for school by matching them to scholarships, grants and awards for which they actually qualify. Sign up today to get started. You'll find scholarships like the Course Hero's Monthly Scholarship, and VIP Voice's $5,000 Scholarship.