PLUS Loan Default: Consequences of Not Paying

A PLUS loan default is a serious matter that is much different than a regular student loan default. In fact, a PLUS loan default can have consequences that are much more severe than other loan types, such as federal Stafford or Perkins loans. Regardless of the type of student loan that you have, there are some important considerations that you should make in the event that you find yourself struggling to pay. The consequences of a PLUS loan default are significant and should be avoided at all costs.


If you are in danger of a PLUS loan default, the first thing that you should do is consider other PLUS loan products that may be beneficial to you. This includes the PLUS loan consolidation, which combines all of your federal student loans into one and results in a lower monthly payment amount and often a reduced rate of interest. Additionally, anyone struggling with a PLUS loan already would be wise to consider a PLUS loan rehabilitation, which can help to resolve delinquency and restore favorable terms on the account.

Consequences of not paying a federal loan can be quite damaging, but even more so in the case of a PLUS loan. This is because when a parent takes out one of these loans to fund their child’s education, their personal credit and guarantee are used to secure the loan. When the terms of the loan are not fulfilled, the federal government can retaliate by garnishing wages, seizing property, and in some cases, requesting jail time for serious offenders.

Unlike other types of loans, federal educational loans can never be discharged, charged off, written off as a tax loss, or included in a bankruptcy petition. Essentially, these types of loans must be paid- period. There’s really no way around it, so if you’re having trouble with your federal loan, you should talk to a loan administrator right away to make special arrangements on your account.

Are you having trouble making your student loan payments? Consider a PLUS loan rehabilitation.

Have too many educational loans? Get lower payments and better terms now with a PLUS loan consolidation.