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Federal Student Loans:
Get Out Of Default

Has the U.S. Department of the Treasury, Bureau of the Fiscal Service, contacted you about a federal student loan you owe? There are several different types of agreement options you can choose from to make payments towards your loan(s).

The chart below outlines in alphabetical order, the agreement types to resolve your defaulted loans that are generally available. Please contact one of our Customer Service Representatives at 1-855-837-2984, Monday through Friday, 8:00 a.m. – 5:00 p.m. Central Time to discuss your options or enroll in an agreement.

Agreement Type

Payments Based Upon

General Description


Balance of loans

  • Pay a reduced amount by settling your loans through a compromise.

  • All payments in a compromise agreement must be received within 90 days or the agreement is no longer valid and the borrower is again responsible for the total loan balance.


Balance of loans or borrower's income

  • To consolidate a federal student loan, you'll be asked to make at least three voluntary consecutive on-time payments on the defaulted loan. If you don't want to make three voluntary payments, you can still consolidate your loans if you agree to enter into an income-driven repayment plan. Once complete, your loan will be consolidated into a new loan that is no longer in default.

  • The default history from your defaulted loan(s) will not be removed from your credit history.

Payment in Full

Outstanding balance of loan(s)

  • Borrower pays full loan balance including interest and fees.


Borrower's income

  • Pay a monthly amount toward your loan(s), based on your income.

  • Nine on-time payments in a ten month period are required to complete the program.

  • Upon successful completion of the program, loans are returned to the current status and the default status is removed from the borrower’s credit report.


Borrower's income with consideration to loan balance

  • Borrowers can pay their full balance over as many as 240 payments.

To determine which payment agreement may be right for you, please contact one of our Customer Service Representatives at 1-855-837-2984. The Customer Service Representative can provide information about the benefits of each type of agreement and find an agreement that best meets your needs.

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