If you can't make your student loan payments, take action immediately. There are a number of free resources available that will help you avoid defaulting on your loans.

Student loans are the bane of my existence.

I graduated with $206,000 in student loan debt from undergrad and law school, and I’ve spent the last three years repaying my loans (my balance is now down to $124,000!). There have been periods when I felt overwhelmed and didn’t know what to do. I didn’t know how I would be able to make my payments, let alone get myself out of debt.

Fortunately, if you can’t make your monthly student loan payments, there are options. Here are five steps you can take if you’re falling behind:

Change your repayment plan

If you have federal student loans, you have access to several repayment options that could lower your monthly bill. The traditional plan is a 10-year plan, but you can extend that to up to 25 years, which will lower your monthly payments. Or you can opt for an income repayment plan that bases your amount due each month on your current income.

One thing to keep in mind is that you can always change your plan as your income fluctuates. Opting for lower monthly payments can be a temporary fix until you can afford to pay more.

If you have private loans, you will have to contact your private student loan lender to determine what repayment options are available.

Related: What’s the smartest way to repay your student loans?

Apply for forbearance or deferment

Forbearance and deferment are free programs offered by all federal student loan servicers that allow you to put your student loan repayments on hold.

  • Forbearance allows you to stop making payments on your loans for up to 12 months due to financial hardship, illness, or other reasons.
  • Deferment allows you to put your payments on hold for a period of time (up to three years or longer) due to being in school, economic hardship, or serving in the military or the Peace Corps.

Always ask for deferment first

During deferment, the federal government will make your interest payments on several types of federal student loans. This is not the case with forbearance, where interest continues to accrue.

When you apply, be sure to ask if you qualify for deferment. The customer service rep may try to steer you towards forbearance (during which you still pay interest) or simply be ignorant of the difference.

Caution! Watch out for student loan scams

You’ve probably seen or heard ads offer “student loan relief” or “student loan forgiveness”. Do NOT call these companies. At best, they will charge you several hundred dollars to apply to one of the totally free government programs we just mentioned.

Related: Understanding student loan grace periods, deferment, and forbearance

Consolidate your student loans

Student loan consolidation may lower your monthly payments for two reasons:

  • By consolidating, you may get a lower interest rate.
  • You may get additional repayment options, including a 15-year or 30-year repayment plan, versus the traditional 10-year repayment plan.

If you can lower your interest rate or get on a longer repayment plan, student loan consolidation may be a good option for you. But be sure you’ll get these benefits before actually consolidating.

Check out our student loan consolidation guide here.

Refinance your student loans

You may be able to refinance your student loans to get a lower interest rate, which would lower your monthly payments. However, be careful about refinancing federal student loans because, as of now, you can only refinance through private lenders.

This means your federal student loans will convert to private loans, and you will lose forgiveness options and income repayment plan options. If you are fairly certain that you’ll be able to pay your debt if you refinance, this may be the option for you. Just be sure you’ve thought it through!

Credible is a partner of Money Under 30 that offers a totally free calculator to see if refinancing could save you money. If it will, Credible will show you potential interest rates and payments at pre-qualified lenders. See how much refinancing could save you with Credible here.

Credible Credit Disclosure - To check the rates and terms you qualify for, Credible or our partner lender(s) conduct a soft credit pull that will not affect your credit score. However, when you apply for credit, your full credit report from one or more consumer reporting agencies will be requested, which is considered a hard credit pull and will affect your credit.

Don’t let your loans go to collections

Try everything you can to avoid your student loans going to collections. If your student loans do end up in collections, it means that you haven’t paid your loans for a period of time (usually 270–360 days) and your loans are in default. When your loans are in collections, your total student loan balance becomes due immediately — yikes!

If your student loans go into default, there are a number of things that can happen, including:

  • You’ll get hit with fees ranging from 20–40 percent of your entire student loan balance.
  • Your wages and tax refunds can be garnished.
  • Your credit is hit hard, which means you may have trouble getting financing in the future.
  • Debt collectors will try to get their money back — until they do.

To get out of collections, you have to take action. Ignoring it won’t help. You can try to get current on your payments or pay the amount in full. If these don’t seem like real options for you, try to work with your lender and agree to a new repayment plan. Once you are out of collections, stay out.

Related: This is what happens if you don’t pay your student loans (yes — it’s very bad)


If you can’t afford your student loan payments, you have several options that are all better than doing nothing.

  • You can contact your student loan lender and see what payment options would lower your monthly payment.
  • You can ask your lender about forbearance and deferment options.
  • If you have federal loans that, if consolidated, would lower your interest rate, you can also consider student loan consolidation.
  • A step above consolidation is completely refinancing your loans. Refinancing your loans will turn federal loans into private loans, but if it lowers your interest rate and enables you to afford your payments, it may be the way to go.
  • Finally, if your loans go to collections, there are actions you can take to get back on track.

Related Tools

About the author

Total Articles: 13
Natalie Bacon is the blogger behind Financegirl, where she writes about finance and intentional living for young professional women. Natalie is a former corporate attorney who traded in her job to pursue a career in financial planning, freelance writing, and blogging.