Consolidate your loans
Loan consolidation removes your student loans from default by refinancing the debt into a new loan, with a single interest rate and repayment schedule. But you have to act quickly. After 60 days from the date of default, defaulted loans appear on your credit report and can remain there for up to seven years.
When you consolidate your loans within 60 days of default:
- The default won’t be reported to credit bureaus
- Previous remarks reported by ECMC to credit bureaus will be updated from a “Collection” status to a “Paid Collection” status
- Any legal action against you stops
Be careful when considering consolidating your loans—it may not be the best option for managing your defaulted loans. If you are unable to consolidate your loans within 60 days after defaulting, rehabilitation may be a good option. With loan rehabilitation, you may also be able to remove the default from your credit report.
Contact your loan holder to discuss consolidation and other options including rehabilitation for dealing with default.
If you don’t know who your loan holder is, go to the National Student Loan Data System (NSLDS), which is the central database for all federal student loan information.
If ECMC holds your loans:
