If you quit college do you still have to pay back your student loan and will it mess up your credit?

Question

i have this friend and she quit college last year and she never paid on her student loans and she moved to a different city and she didnt tell the student loan people where she moved and now she is trying to get an apartment and car will this affect her credit score

Answer 1

Student loans are impossible to get rid of. In fact some of them are immune even to bankruptcy meaning that even if you go bankrupt you still have to pay back the student loans.

Your friend will eventually get caught and she will owe back the loans, penalties, and interest. Her credit will be ruined which will make it much harder to ever buy a car or a house on credit, obtain credit that is not at an outrageous interest rate, obtain insurance at a low rate, or even rent an apartment. She is being an idiot, and needs to realize she is only hurting herself and her future financial well being.

Answer 2

Yes. This is a loan, not a gift. The loan people have her information on file and as soon as the loan comes due, she will be in default. Defaulting on a loan can result in a bad credit score, garnished wages, and other things. Usually a student loan gives a grace period of a certain amount of time, from a few months to a year. She may be able to receive an extension on the grace period from the loan company...however, interest on the loan will continue to accrue.

Answer 3

Your friend will have to pay back whatever money she borrowed, whether she completed college and received a degree or not. She's taking a big risk applying for an apartment lease and a car loan. That'll be a BIG red flag to the government or whoever loaned her the money for college. If she received loans from a government agency, the IRS can take whatever money she owes out of her tax returns, and if she can't pay the full bill with her tax refund the interest rate on her loan goes up to 36.5% APR. If she received loans from a private agency, they can take her to court (state or Federal) and have her wages garnished. Tell your friend to pay that loan off before she does anything else. She can get in a lot of trouble, and her credit rating will take a nose-dive -- if it hasn't done so already.

Answer 4

Hell yes you have to pay back your student loan, and hell yes it will ruin your credit. Student loans are backed by the government, and you can't even get rid of them by declaring bankrupcy. There is some good news- they will work with you for lower payment plans, and if it makes you feel any better, I owe $140,000- and I have friends who are dentists that owe $450,000.

The thing they hate the most (the lender) is if you don't keep in contact with them. Have your friend call and let them know where she is, and tell them you want to repay

Also, they have these things called deferments, and you can defer a loan for financial hardship reasons (and other reasons) for up to 5 years! My advice though, is to pay regularly- they give you incentives, like lowering the interest rate if you make regular payments, or if you allow for automatic withdrawal. Good luck!

Oh, one more thing- if you go back to school, they will put the loans on hold and pay the interest while you are in school.

Answer 5

You are supposed to start paying back your student loans after you finish or quit school. Most probably the loan center will do something to her so that they can find her. Not paying on a loan will affect her credit score and look bad to other loaners.

Answer 6

Rest assured that even if a person moves, any government entity will find them. Regardless as to whether you quit school or graduate, student loans must be repaid. Interest accrues as long as the loans remain open, and yes this will affect your friend's credit.

Answer 7

What credit card expenses 40 5% interest? ought to college scholars be insulated from getting credit enjoying cards? No -- they are adults, able to arising person judgements over their very very own affairs. They communicate approximately reducing the eating age and the smoking age because of the fact they are sufficiently previous to combat in a warfare, then they screw up their credit and suddenly they are too youthful and naive to be entrusted with their very very own funds. as quickly as somebody is eighteen, it is it. human beings won't be able to easily be an person purely while it is relaxing or handy. Do the credit card companies drag the cardboard holders out to the mall and to bars to cause them to spend? Do the credit card companies in any way imprecise somebody's earnings so they are able to't in all probability comprehend what they are able to discover the money for? Do the credit card companies arbitrarily run up human beings's balances to $30,000? No. human beings, previous and youthful, in simple terms spendspendspend and positioned off coping with it until eventually later. while later comes, they swear they are being victimized. you do no longer hear every physique crying approximately their evil credit enjoying cards while they are spending on relaxing stuff; purely while the expenses are available in.

Answer 8

Yes. A loan is a loan. Default is default, regardless of the reason.

She will be affected.

Answer 9

Hell yeah!!

The student loan people are incredible at finding people. It's just a matter of time.

Answer 10

Yes, you will have to pay it back and if don't make timely payments it will affect your credit.