A student who has stopped repaying their personal loan implies their account has actually defaulted. When a student intentionally stops making back their payments, it is regarded a strategic default.
Sometimes a student may find that after many years of repaying their loan, the remaining balance hasn’t decreased greatly. In some cases the unsettled balance really increases because of the high rates of interest.
This is why some students will look upon a strategic default. Often there appears to be no other attainable choice. This strategy is ideally suited to those who are going to be late on their payments. Nevertheless, it is something that increasingly more students are thinking about because of the very limited payment choices available to them.
This decision to strategically default is one that should be taken very seriously. No respectable counselor can instruct you as to whether you should go down this path or not. The student must consider all the pros and cons before anything else.
We have actually put together this useful infographic to help deliver some information that should hopefully make your decision simpler.
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