If you have hit a brick wall during the financing of a student loan, you may be able to recover using the HEA or Higher Education Act’s Section 674.39 on Loan Rehabilitation.
The Higher Education Act of 1965 and the 1998 amendments clearly state the required statutes of this Act. To wit:
If the borrower of a loan made under this part who has defaulted on the loan makes twelve on time, consecutive, monthly payments of amounts owed on the loan, as determined by the institution, the loan shall be considered rehabilitated, and the institution that made that shall request that any credit organization or credit reporting agency to which the default was reported remove the default from the borrower’s credit history.
As long as the borrower continues to make scheduled repayments on a loan rehabilitated under this paragraph, the rehabilitated loan shall be subject to the same terms and conditions, and qualify for the same benefits and privileges, as other loans made under this part.
The borrower of a rehabilitated loan shall not be precluded by section 484 from receiving additional grant, loan, or work assistance under this title (for which the borrower is otherwise eligible) on the basis of defaulting on the loan prior to such rehabilitation.
A borrower only once may obtain the benefit of this paragraph with respect to rehabilitating a loan under this part.
If the borrower of a loan made under this part who has defaulted on that loan makes six on time, consecutive, monthly payments of amounts owed on such loan, the borrower’s eligibility for grant, loan, or work assistance under this title shall be restored to the extent that the borrower is otherwise eligible. A borrower only once may obtain the benefit of this paragraph with respect to restored eligibility.
If you need further information, you can check online or contact the college’s financial aid counselor.
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