What happens when you stop paying?

What happens when you stop paying loans? I have >300k with one of the big private ones (earnest / SoFi / Lending Tree / commonbond). I’m tired of working to the bone to pay more than mortgage.

What happens if I stop paying? I would default… but then what? They sue you? They garnish private wages? I get arrested?


I would love to know! I am $120 grand in student loan debt and I do not even make $50 grand per year. And I have been a teacher for8 years!


Hi angie ,

If you’re a public school teacher, and the loan is a public student loan, i would consider getting into the public service repayment program available through the federal govt. … if you are not a public school teacher, but a private school teacher, you should be able to get into the income based repayment program available though the federal govt. To do these, you have to consolidate your loans through federal direct loans.

I would not stop paying. Going into default is not a good idea. If you are having diffculty repaying , it is better to try and get a deferment or a forbearance.

What can happen by going into default depends on the laws of your state. I’ve heard of people having their wages garnished for going into default.

Hi Emily,
With private loans, it is different than public.
I would go to consumer credit counseling services (CCCS) and speak with a representative. Or, maybe get some advice from an attorney. Usually, there are free consultations.

1 Like

If we ALL stop, then what? Hashtag Just Default. :slight_smile:


Penalties include garnishment of wages, bank accounts, and future Federal tax returns until the debts are paid off. There’s ways around it - self-employment can prevent garnishment of wages, bug not of bank accounts, and making sure you don’t overpay on taxes so you aren’t owed refunds will prevent garnishment of those.

Your credit will take a hard hit. Forget getting credit cards, mortgages, etc. for years. If you’ve already got a mortgage, you won’t be able to refinance.

Other than that, it’s going to depend on your locality. Some states, you can lose your driver’s license. Debtors prison is technically illegal - debt is a civil matter not a criminal one - but don’t be surprised if that changes.

Debt collectors will hound you relentlessly, and will hound your family members as well, looking for you, which is barely legal, but they get around it.


Hi Connar,
Yes i went through all of the hoops. That’s how i know about it. It’s just crazy. But i had to consolidate to get into the income based repayment program. My payments were massive by the time i finished school. Made worse by not being able to work in my field because i kept flunking the certification tests. So it was massively difficult. Then, i had a breakdown. And went onto disability. It has beem very hard. But the income based repayment program has saved my life.


We have $300k too between my daughter and us (her parents). But we don’t have all in private loans… so we filed the DTR. I did apply for income based first and they said I made too much money. My daughter got no job out of college and just couldn’t do any of it. She contacted the Harvard Project and they gave her the name of a lawyer near her who is helping her pro bono (I think). The lawyer wouldn’t work with us because… you guessed it… we made too much money. So my daughter filed DTR thru the lawyer and everything stopped - all the harrassing calls (hourly… which is illegal btw, if it happens write it ALL down) and her credit, of which she had NONE, came back to some. Our credit too came back up once I filed for DTR. I don’t know what will happen if DeVos gets going on all this but for now we’re okay. Even tho we make a fair income, we couldn’t pay the loan payments… it was for us, $1100 for interest alone!!! So I say (to anyone who will listen) I am NOT paying it.
Good luck Gwynne!


Well $52,000 in debt from school and working in a dental office. I majored in political science. Couldn’t afford the $500 monthly payments unless I wanted to be homeless and starving. Idk how in the hell to get them off my back. But say good bye to your tax refunds. Talk about robbing the poor to feed the rich. :roll_eyes::roll_eyes:


Yes, I agree the payment amount can be made lower in the repayment program (through Nelnet, the income-based repayment plan is called REPAYE), but I also agree that consolidation is a months-long burdensome affair that you must keep on top of, submit form after form, and watch like a hawk. I have more than 30 separate loans consolidated under the Direct Loan program, totaling $180,000. I consolidated in 2005/2006 when I returned to college to achieve 1) a bachelor degree, and 2) an in-school deferment. The piper must be paid now, and this is the problem: repayment at this low amount ($212 in 2019; estimated to be $286 in 2020) is tantamount to being in debt for life, because the low payments will not pay down the interest, let alone the principal. So, what do people in our position do? Default? Bargain with the lender? I do not wish to have my wages garnished, because that is beyond my control. I could use cash only. I could modify my federal tax withholding to not have a refund at year-end susceptible to tax-refund-intercept. It is a hard decision what to do, because we refuse to live hand-to-mouth. I’m going on 55 and a teacher in a federal workforce training program. No retirement plan. No retirement savings. No public loan forgiveness option, which is laughable because even among those who have applied, the denial rate is 98%, according to investigative reporting by CBS News.

Hi Kit,
Wow. I didn’t know that the income based repayment program was limited to low income. I read about a doctor whose payments were way over her head. I think she owed 300k for medical school. She was able to qualify.
Glad the DTR helped you all.
Kind regards.


Not true, these are private loans, they cannot garnish wages, take your tax return or DL. If these were federal loans, then you would be correct.

I would stop paying the private, your credit will take a big hit but a private student loan is similar to any other private loan (car). It goes into default, your state has a time limit of when they can try to sue you, which most don’t. Do a little more research, there are options. And like someone else said, what happens if we ALL default?!

1 Like

It is unlikely a large number of borrowers, let along all, will default without a strong movement and clear message.

In the meantime, we need a clear definition of default. What does default even mean? If it means stop paying entirely, then why not encourage payers to pay a courtesy amount, say, a dollar a month? Then, borrowers can’t be accused of not paying at all. This is what I mean by a clear message. This site would benefit from a glossary of terms. Can we add a wiki to this site?

I have about 20k in federal loans. I stopped paying because they refused to accept payment from my joint bank account after I got married. I had to maintain a separate bank account and it got to be too much to juggle when I had my baby. I used all my deferment time and they threatened to garnish wages and take my tax return. I have already had a tax return stolen from the state level because the number of hours for my state to consider someone “full time” was a single credit hour below “over time” as defined by my institution. As many of you know, single credit hour courses are not common, so I would have had to be overtime to be considered “full time” by the state. I ended up getting audited after asking why I didn’t get the full time student credit one tax year. They hit me up for the amount given, plus interest, plus a penalty. I asked about income based repayment for my federal loans, but with my husband’s income (about 60k for a family of 3) I was told it would still likely be several hundred a month. I was advised by someone on the student debt repayment line that if I stayed in default and payed any allowable amount toward my debt every month, there would be no consequence. The minimum is $5, and I’ve been paying $50 (though I’m highly debating dropping lower). We just got our federal tax return and I’ve been doing this for about a year now.

1 Like

Consider your age and constitution when making your decision on how to approach debt. Debt resistors would do better to study the methods of tax resistors. Acting as an independent resistor is dangerous and ineffective, that’s what the work of tax resistors has taught us. I’m in my 50’s and started resisting student loan debt when I left college over 25 years ago. There are a few specific ways to keep the Feds from getting your wages/taxes and very few ways to get your loans forgiven. It’s easy to figure it out that there’s almost no way out and just a few weapons you have to protect your livelihood. The real issue is psychological. I consider myself hard as nails and educated but the psychological effects of debt, coupled with aging has been undeniable. Debt is a psychological condition and resisting requires a lifetime of serious support (both emotional & legal). To mitigate inevitable consequences it takes strategic planning! But more, it requires a fanatical commitment to the bottom line. There’s no way to “negotiate” with the system without an extreme understanding of your own bottom line. Although, I cherish my education, I always knew that borrowing against my future to get it was wrong and that the system was predatory. I look to the Lakota for how to build a character that can sustain a long term fight for justice by refusing to “negotiate” immoral and abusive terms and conditions. TRADITIONS of resistance exist and we can all use the tools that have evolved to stand against SYSTEMIC abuse.


I stopped paying last September and we get a bunch of collection calls but due to covid all the accounts have no closed but they can’t do any garnishment because all the courts are closed. I can’t tell you what happens because I haven’t experienced anything yet. Your credit would plummet too which mine did. But since all the accounts are now closed it shot up by 60 points. These are all private loans with navient and discover.

1 Like