Avoiding Default

What is default?

Default results if you fail to make a series of scheduled minimum monthly payments on your loan account. Negative consequences of default may begin when a loan becomes 180 days past due. Default and delinquency cause long-term damage to your credit record.

What happens if I default on my loan?

If you default on your loan, any or all of the following may happen:

  • The entire loan balance (principal and interest) becomes immediately due and payable
  • You will lose your deferment options
  • You may be charged collection costs
  • Your loan(s) status will be reported to national credit bureaus, including delinquency and default
  • Your Alaska Permanent Fund Dividend (PFD) may be garnished and applied to your loan(s)
  • Your wages may be garnished to repay your loan(s)
  • You may not be able to renew your professional license
  • You may lose eligibility to obtain educational aid in the future
  • Your school may withhold copies of your transcripts
  • Your account may be referred to the loan guarantor for additional collection action, which may include income tax garnishment, being sued for the balance of your loan and other collection type activities.
  • Your account may be referred to a collection agency

How can I avoid default?

  • Read the terms of your promissory note carefully to know your obligations and options
  • Read and respond to any correspondence you receive from ACPE
  • Notify ACPE if you change your address or phone number
  • Notify ACPE if you leave or return to school
  • Contact us immediately if you are unable to make your scheduled monthly payment
  • Learn about and use the deferment, forbearance or repayment plans available to you

Don't wait until your account becomes delinquent or in default. If you are unable to make a payment, contact ACPE as soon as possible to discuss options that could adjust your repayment schedule and lower, or even postpone your monthly payments.