Falling behind on student loan payments can have serious consequences, but many borrowers don’t realize how quickly things can spiral out of control. Whether you’re struggling financially or simply forgot to make a payment, skipping even one installment could lead to credit damage, late fees, and even wage garnishment down the road.
Here’s what happens when you miss a payment—and how to avoid the worst-case scenario.
What Happens Immediately After a Missed Payment?
The moment you skip a payment, your loan becomes delinquent. This means you’re officially behind on your payments, but you still have time to fix the situation before things get worse. If you have a private student loan, your lender might charge a late fee right away. However, federal student loans don’t have late fees, so you won’t see an immediate penalty.
If you don’t catch up quickly, things can start to snowball.
90 Days Late – Your Credit Score Takes a Hit
After 90 days of non-payment, your loan servicer will report the missed payment to the three major credit bureaus—Experian, Equifax, and TransUnion. This can significantly lower your credit score, making it harder to get approved for credit cards, car loans, or even an apartment lease in the future.
270 Days Late – Default Kicks In
If you go nine months (270 days) without making a payment, your loan goes into default. This is where the real trouble starts. When a loan defaults:
- The entire remaining balance of your loan may become due immediately (a process called acceleration).
- The government can garnish your wages, meaning money will be taken directly from your paycheck.
- Your tax refunds and Social Security benefits could be seized to pay off your debt.
- You lose access to repayment options, deferment, and forbearance programs.
- Your loan might be sent to collections, which can add even more fees.
Once a loan is in default, getting back on track becomes much harder—and much more expensive.
How to Avoid Default and Stay on Track
If you’re struggling to make payments, there are options to help you avoid serious consequences.
- Income-Driven Repayment Plans (IDR): Programs like the SAVE plan lower your monthly payments based on your income and family size. Over 8 million borrowers have signed up for this plan so far.
- Deferment and Forbearance: If you’re going through a temporary financial hardship, you may be able to pause payments without going into default. Just be aware that interest may still accrue.
- Communicate with Your Loan Servicer: If you’re having trouble making payments, don’t ignore the problem—reach out to your loan servicer as soon as possible. They can help you find a solution before things get out of hand.
Final Thoughts
Missing a student loan payment isn’t the end of the world, but ignoring it can lead to serious financial trouble. The key is to act quickly and explore your options before your loan falls into default. By staying on top of your payments—or working with your loan servicer to adjust them—you can avoid the harsh penalties that come with delinquency and default.
If you’re worried about making your next payment, now is the time to take action. The sooner you address the issue, the easier it will be to get back on track.
