No one wants to get behind on their bills, but your student loans should take priority if you find yourself struggling to make ends meet. If your federal student loans go unpaid for 270 days (about nine months), they enter default. The consequences of letting your loans go this long is that you lose your eligibility for some federal repayment programs, and you could be sued or taken to collections. The federal government can even garnish your wages or take your tax refunds until you’re caught up.
If you’re nearing the nine-month mark on a student loan that has fallen behind, make a payment as soon as you can to avoid going into default. Even if you can’t come current on what you owe, making a payment shows your intent to get caught up. Call your lender and explain your situation to them—they may be able to put you into a payment plan that fits your circumstances better, or help you pause your loan payments through deferment or forbearance.
Getting back in good standing will take some time. The primary way to do this is with loan rehabilitation. You’ll need to show your responsibility by making nine on-time payments over ten months. Once you do so, your credit report will show your late payments, but won’t show that you were in default.