Default Failure to make monthly payments on student loan debt for nine months or more. Default significantly damages a borrower's credit record and eliminates a borrower's eligibility for financial aid and deferment options. Delinquen cy Failure to make loan payments when due. Delinquency can lead to default. Disbursement Delivery of funds to the borrower either by check or through electronic funds transfer to the school.
Exit counseling occurs when the borrower leaves or graduates from school.
Financial Need Financial need determines how much aid, including student loans, a borrower qualifies for. A special agreement between lender and borrower to delay or reduce monthly loan payments because of financial difficulties. A period of six months that starts after the borrower graduates or drops to less than half time. When the full six months expire, the borrower enters repayment. This repayment option initially lowers loan payments, but gradually increases the payments over the length of the repayment period.