Consolidating all student loans

When your loan is rehabilitated, the default status will be removed from your loan, and collection of payments through wage garnishment or Treasury offset will stop.You’ll regain eligibility for benefits that were available on the loan before you defaulted, such as deferment, forbearance, a choice of repayment plans, and loan forgiveness, and you’ll be eligible to receive federal student aid.To rehabilitate your loan, you must choose one of the two payment amounts.Your loan holder may be collecting payments on your defaulted loan through wage garnishment or Treasury offset (taking all or part of your tax refunds or other government payments).

However, loan rehabilitation provides certain benefits that are not available through loan consolidation.

One way to get out of default is to repay the defaulted loan in full, but that's not a practical option for most borrowers.

The two main ways to get out of default are loan rehabilitation and loan consolidation.

However, your credit history will still show late payments that were reported by your before the loan went into default.

If you consolidate a defaulted loan, the record of the default (as well as late payments reported before the loan went into default) will remain in your credit history.

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Your required monthly payment amount is determined by your loan holder.

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