Managing Your Credit and Avoiding Default

Many times an unexpected expense can occur; such as: car repairs, medical expenses, relocation expenses. These unexpected expenses can sometimes make it difficult for you to make your monthly loan payment. If you think you will have difficulty making your loan payment owed to MU, contact us immediately!

Options For Borrowers Having Difficulty Making Their Payments

You might qualify for a deferment you were not aware of. Check our loan programs webpage for the type of loan you borrowed.
Your loan could qualify for a temporary repayment arrangement.
Your loans could be eligible for consolidation.
If you have a Perkins or National Direct Student Loan (NDSL) you might be eligible for rehabilitation.

Consequences of Late Payments

You will have a damaged credit rating. The MU Student Loan Collections Office reports the status of all loans (whether current or past due) to a national credit bureau monthly. Past due credit ratings will prevent you from getting a credit card. Past due credit ratings can also prevent you from getting a mortgage or a car loan; or you might be charged a higher interest rate on your mortgage or car loan. You could also be charged higher auto and home insurance rates. Past due ratings stay on your credit report for 7 years.
You will become ineligible for additional federal aid.
Your loan can be "accelerated" and sent to a collection agency. "Accelerated" means become due in full and you will no longer be entitled to make monthly payments and you will lose your right to deferments and cancellations. You will have to pay the collection agency commission on your loan. Some commissions can be as high as 50%.
You can be taken to court and would have to pay all attorney fees and court costs.
Your loan can be assigned to the Department of Education. ED can garnish your wages and take your income tax refund.
You will not be allowed to receive official transcripts.
You will lose deferment/cancellation privileges until your loan is paid to current status.
You could lose your professional license.
There is no statute of limitations on student loans which means that we can pursue collection of your student loan until you pass away.

Managing Your Credit

Making your loan payment on time each month will help you establish a good credit history.
Having a credit card can help you establish good credit history ONLY IF you pay the balance in full each month. It is best to start off with just one card and pay the balance in full each month.
You should request a copy a your credit report once a year from each of the 3 major credit bureaus and check it closely for inaccuracies.
Equifax - www.equifax.com
Experian - www.experian.com
Trans Union - www.tuc.com