TAMPA, Fla. — They're expenses some people find a way to work into their budget every month: federal student loans.
"I've been paying them,” said Matt Carter. “I have autopay set up. It takes out every month, standard."
"I don't let the interest accrue, and I just keep paying them,” said Skylar Nocita.
Their advice? Try and stay on top of it.
"I think if you're in forbearance, it's better to just keep paying, make sure your interest is at zero, and then you can keep paying the principal because the interest is what really kills you,” said Nocita.
For those in default, the clock has run out: on Monday, the Department of Education resumed collections on defaulted federal student loans.
It hasn't collected on defaulted loans since March 2020.
"You don't default the very first day you don't make a payment,” said Christie Arkovich, the founding attorney at Arkovich Law. “You actually have a little bit of time. It's 270 days, basically 9 months."
WATCH: Department of Education resumes collections on defaulted student loans
There's a laundry list of consequences of default, including damaging your credit rating.
Officials said the Office of Federal Student Aid will send required notices beginning administrative wage garnishment later this summer.
"Collection is a whole different matter,” said Arkovich. “It's actually easy for the federal government to collect on a federal student loan by simply intercepting a tax refund that's due. They also can garnish wages very easily."
The Education Department said the main ways to get out of default are by rehabilitating or consolidating your loans.
This chart compares the two options.
Loan rehab has some benefits you can't get with consolidation, like removing the record of default from your credit history. Officials say rehabilitation can take several months to finish, but borrowers can quickly apply for consolidation.
Borrowers are encouraged to contact the Default Resolution Group to make a monthly payment, enroll in an income-driven repayment plan, or sign up for loan rehabilitation.
If you don't know your status, you should check online or call your servicer. All borrowers in default should have gotten an email over the last two weeks.
"There are no safeguards, and I feel like that's part of where the system failed"
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