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Loan Default Calculator

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This Loan Default Calculator illustrates the extra costs associated with defaulting on a student loan.

Under current law, the following charges may be assessed against a defaulted borrower:

  • Late Fees. Up to 6% of each late installment, where late is defined as more than 15 days after the due date (FFEL) or 30 days after the due date (DL).
  • Collection Charges. Collection charges of up to 25% of the amount applied to principal and interest (20% of each payment on a defaulted loan) may be deducted before applying the remainder to late fees, then accrued interest and finally to principal.
  • Garnishment. The government may obtain garnishment of up to 15% of disposable pay. Disposable pay is defined as income remaining after deduction of any amounts required by law to be withheld, such as income taxes.

These charges can significantly increase the cost of a loan.


Loan Balance:
Interest Rate:
Loan Fees:
Loan Term (Years):
Months of Nonpayment Before Default:
Months Until Claim Filed:
Additional Months of Nonpayment:
Annual After-Tax Income:
Income Growth Rate:
Wage Garnishment Rate:
Collection Cost Rate:
(Percentage of amount applied
to principal and interest.)
Late Fees:
Base Monthly Payment On:
Print payment schedule? Yes No
 

 
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