Student Loans

You will pay the government what you owe them!!

Most student loans are government backed. When you don't pay them they will go into collection and eventually show in default status as an unpaid government debt. I'm not sure how other creditors treat them but for home buying purposes, you could not get a conforming home loan if you were in default over any government debt!

How can you get out of default status? You will have to bring the past due amount current and in some cases, after you have brought it current you will need to keep making your monthly payments on time for a year before they will allow you to be considered no longer in default. They can also take any tax refund you might have been due until your debt is paid in full. So either pay them in full or bring them current and keep them on time for a year to get them out of default.

If you owe the government money you can't even discharge it in a bankruptcy! It's that serious!