How to Return to School Despite Defaulted Student Loans and Title Loans

If you don’t make a payment on a student loan, it becomes delinquent. Your loan will default after you have missed payments for a specified amount of time 270 days for most federal student loans and 120 days for most private student loans.

Not only would defaulting harm your credit, but it may also prevent you from receiving the financial aid you require to pay for subsequent classes. The good news is that you have a few choices for getting out of default and regaining financial aid eligibility.

Title loans: how do they work?

Ownership of the vehicle or a large equity share is required to qualify for a short-term loan from GreenDayOnline – Colorado title lender. The loan is secured by the title to your automobile, which is a legal document proving that you own the vehicle, and repayment is often due within 15 or 30 days.

Title loans in the Washington DC location may be obtained online or at a brick-and-mortar establishment. To apply, you must complete an application form. The only way to demonstrate your automobile is if you’re at a physical location of the company.

If the lender asks for more evidence, you’ll need to provide an unambiguous title, a photo ID, proof of insurance, and any other information they need. You may even give the lender another set of keys if you choose. You’ll be able to keep driving your automobile while repaying the loan.

If you’re having trouble making payments, you may be able to refinance your current loan, but this will simply result in higher fees and interest. Lenders may remove your automobile and sell it if you don’t pay your bill.

As a result of the high-interest costs of title loans and the fact that they are not legal in many states. Some states have outright bans on them, while others have rates that are strictly restricted. The rules don’t exist in certain states.

You can borrow up to what amount?

You may get Title Loans in Arkansas for anything from 25 to half the value of your car on average. Depending on the lending institution, the loan amount might range from $100 to $10,000. You may pay back the loan amount in person, via the internet, or by automatic transfer from your bank account, depending on your preference.

What choices do I have if I wish to return to school despite defaulting on student loans?

It may be challenging to return to school if you have defaulted on student loans, especially if you have defaulted on federal loans, as you may be disqualified for further government funding.

However, suppose you can get your loans out of default. In that case, you may be able to reclaim financial help and other federal benefits, including income-driven repayment (IDR) plans and student loan forgiveness. Here are a few options for getting out of default on your student loans:

Get your delinquent student loans rehabilitated.

One possibility for getting a federal student debt out of default is student loan rehabilitation. 

You must agree to make payments for nine to ten months to rehabilitate a student debt, depending on your loan type.

If you complete rehabilitation, your loan’s default status and credit report will be deleted, which may be beneficial as you begin to restore your credit. 


  • The default status will be removed from your credit report: If you make reasonable installments, the default status will be deleted from your loan and credit report. However, keep in mind that any missed payments will appear on your credit report.
  • Lower payments: If you have Direct Loans or loans from the Federal Family Education Loan (FFEL) Program, your rehabilitation plan payments will generally be limited to 15% of your discretionary income. If these payments are too high for you, your servicer may be able to give you a reduced payment option after analyzing your income and spending. If you have a Perkins Loan, keep in mind that your payments will not alter.
  • Restores eligibility for other federal benefits: If you can get your loan out of default via rehabilitation, you may be eligible to acquire federal financial aid to continue your education. You’ll be eligible for various government benefits once more.


  • A more time-consuming process than consolidation: It takes nine to ten months of payments to correctly complete rehabilitation, which is a longer procedure than consolidating student loans. You may have to put school on hold until your debts are in good standing unless you have other ways of paying for your classes.
  • New agreements for several loans are required: If you want to rehabilitate more than one loan, you’ll need to enter into a separate agreement.
  • Won’t stop wage garnishment: If your earnings are being garnished, you can seek rehabilitation, but the garnishment will most likely remain until you’ve made all of the mandatory payments.

Keep in mind that most private student loan lenders do not offer loan rehabilitation to defaulted borrowers. If you have private loans that are past due, contact your lender to see what options are available to you.

Get your student loans consolidated.

Consolidating a federal student debt into a Direct Consolidation Loan is another approach to get it out of default. While your interest rate will not change, you may be able to prolong your repayment term by up to 30 years, lowering your monthly payments significantly.

Keep in mind that you must either make three complete monthly payments or agree to repay the merged debt on an IDR plan before you can consolidate a defaulted loan. It’s also worth noting that if you have a defaulted Direct Consolidation Debt, you’ll need to consolidate at least one other loan.


  • More quickly than rehabilitation: If you choose to combine a defaulted debt, you can complete the process in as little as 30 to 45 days, which is far faster than rehabilitation.
  • You might be able to lower your payments: You can prolong your repayment period by up to 30 years with federal consolidation, which might lower your monthly payments and relieve the financial burden. Remember that a lengthier term will cost you more in interest over time.
  • Can consolidate numerous debts: If you have multiple loans in default, you can combine them to get them all out of default at once.


  • Consolidating your student loans will not remove the default status from your credit report, unlike rehabilitation.
  • Interest and collection costs are capitalized: After you’ve consolidated your loans, you will add any interest or collection fees from your old loans to your new loan sum.
  • You won’t be able to consolidate your loans if your wages are garnished: If your earnings are garnished due to your student loan default, you won’t be able to do so until the garnishment order is removed or the judgment is vacated.

Keep in mind the following: Repaying your loans in full is another approach to bring them out of default. Most borrowers, however, cannot afford this. Thus rehabilitation or consolidation is typically the preferable solution.

What if I’m unable to repay my student loans after consolidation?

Here are some things to examine if you’re having trouble making payments on a federal consolidation loan:

Repayment based on income: 

If you aren’t currently on one, signing up for an IDR plan could be a good idea. 

Your payments under an IDR plan are based on your income typically 10% to 20% of your discretionary income and could be far less expensive than your present payments. 

In addition, depending on the plan, any leftover balance will be forgiven after 20 to 25 years.


Deferment allows you to stop making payments temporarily. You may be eligible for a postponement if you are experiencing financial hardship, receiving cancer treatment, or enrolling in an approved graduate fellowship program. If you’re enrolled at least half-time at a qualified school, you can also defer your payments. Keep in mind that interest may continue to accumulate on a deferred Direct Consolidation Loan depending on the type of loan you merged.


Forbearance is another option for deferring payments. There are two forms of forbearance: general (or discretionary) forbearance, which your servicer can offer at their discretion, and mandatory forbearance, which your servicer must supply in specified circumstances. 

Keep in mind that interest on your loan will continue to accrue during the forbearance period and will capitalize after that.

Work out a repayment plan for your school loans.

Another option for resolving your student loan default is negotiating a debt settlement. 

When you arrange with your loan holder to pay a lump payment to clear your debt, this is known as a debt settlement. The loan holder may be ready to take a smaller amount than you owe and even forgo collection fees in rare situations.

Remember that your loan holder may refuse to settle, especially if they have alternative collection options, such as salary garnishment. Furthermore, coming up with a lump sum to offer could be challenging. However, it would help if you considered whether you could afford it.


  • You might be able to settle for a lower amount than you owe. Your loan holder may agree to accept a settlement that is less than the total amount you owe. They may be ready to forgo interest or collection fees as well.
  • You’ll be able to get assistance with the negotiations: You can hire an attorney or a for-profit debt settlement company to help you negotiate with your loan holder if you don’t want to do it yourself.


  • There’s a chance your offer won’t be accepted: If your loan holder refuses to settle, you’ll have to find another approach to deal with your student loan default. If they agree to a settlement, they may demand a larger sum than you anticipated.
  • May harm your credit: If you opt to deal with a debt settlement organization, you will most likely be asked to stop making payments while they negotiate with your loan holder. Your credit could be badly harmed as a result of this.
  • Charges may apply: Even if your lender agrees to a settlement, you may still be responsible for interest and collection fees. Furthermore, debt settlement companies usually charge a fee for their services, which is normally 20 percent to 25 percent of the total amount paid.

How to return to school after a student loan default

You may be able to recover your eligibility for federal financial aid and return to school after settling a student loan default. If you’re ready to return to school but need financial assistance, complete these four steps:

Fill out the FAFSA application. 

Filling out the Free Application for Federal Student Aid should be your first step toward paying for extra education (FAFSA). Remember that you must not have any federal student loans in default to qualify for federal aid, and you must also meet the other eligibility conditions.

Apply for scholarships and grants. 

Scholarships and grants, unlike student loans, do not need repayment, thereby making them free money to use for school. There is no limit to the number of scholarships and grants you may apply for, so apply for as many as you can.

Take out student loans from the federal government. 

You could be able to borrow more to fund your school expenditures if you were able to get your federal loans out of default successfully. Most government loans don’t require a credit check, making them a beautiful alternative if your credit has been harmed by default.

Fill any gaps with private student loans. 

Private student loans may be a fantastic way to fill any financial gaps left after you’ve exhausted your scholarship, grant, and federal student loan choices. Remember that, unlike federal loans, you’ll almost always need good to exceptional credit to qualify for a private student loan, which could make it difficult to qualify after default.


If you’re having trouble getting approved for a private student loan because of poor credit, consider applying with a creditworthy cosigner. Even though you don’t need a cosigner to qualify, having one may help you receive a better interest rate than you would otherwise. If you decide to take out a private student loan, look into as many lenders as possible to obtain the best loan for you.