Repayment Terms for Defaulted Loan Borrowers

Defaulted loan borrowers may be able to take advantage of several different repayment terms:

  • Payment in full. By paying the balance of a defaulted loan in full, you avoid paying additional interest and collection costs. You may avoid other consequences of default as well, including federal Treasury Offset and administrative wage garnishment. Once you pay in full, your credit report will be updated to show a paid-in-full status.
  • Standard repayment. For balances of up to $7,500, the Standard Repayment Plan schedules payments over a 10-year term. Try MOSAIEC’s Student Loan Calculator to determine possible monthly payment amounts.
  • Longer repayment terms. On balances that exceed $7,500, you may be able to schedule payments over a term longer than 10 years:
Total Balance Maximum Repayment Term
$7,500 to $9,999 12 years
$10,000 to $19,999 15 years
$20,000 to $39,999 20 years
$40,000 to $59,999 25 years
$60,000 and above 30 years

For more information on repayment terms, call Trellis Borrower Services at (800) 222-6297 or send email to