[debtfreer]

Default usually occurs around 120 days after the last payment has been made.

Federal student loans typically have mechanisms (deferment, forbearance, income-based repayment plans) that make it nearly impossible to truly default on the loans.

Private student loans are similar to unsecured consumer debt. Once the unpaid mark crosses 120 days or so, the loan is effectively collected like any other debt (though debt collectors, collection attorneys, and lawsuits).

Student loan debt is presumably not dischargeable in bankruptcy, unless the debtor can prove that the debt would create an undue hardship and other factors which are very difficult to achieve (see the Brunner Test for most jurisdictions or the Totality of the Circumstances test for the 8th Circuit).

[bogomipz]

>"Federal student loans typically have mechanisms (deferment, forbearance, income-based repayment plans) that make it nearly impossible to truly default on the loans."

Ah ok, so the default referred to in the article is "default" as a status designation and not defaulted in the sense that the lender is taking a loss. I think this is what I wasn't understanding. Thanks.