Student Loan Default: What happens if I default on a Federal Stafford Loan or Federal Perkins Loan?

If a student has defaulted on a student loan, they may not be eligible for additional aid. A student can, however, regain their eligibility for financial aid if they satisfy all of their outstanding loan defaults.

  • To rehabilitate a Stafford loan, a borrower must make nine on-time (i.e., received within 20 days of the due date), full monthly payments to the servicer of the loan during a period of 10 consecutive months
  • Rehabilitating a defaulted Perkins loan requires twelve (12) on-time monthly payments of an agreed amount to the servicer of the loan
Note: Undergraduate students who were eligible and received Perkins Loans fund in 2015-2016 will have priority for available funding for 2016-2017. Any new borrowers, who have exceptional need, will be awarded any remaining funds. Perkins Loans are no longer available for Graduate Students.