Defaulting on a student loan in the United States can have a number of negative consequences. To understand loan default, it is helpful to have a few common terms defined:
Loan deferment is a postponement of a loan's repayment. There are many reasons why someone might seek to defer a loan, including a return to school, economic hardship, or unemployment.
Loan delinquency is a failure to make loan payments when they are due. Extended delinquency can result in loan default.
Loan default is the failure to repay a loan according to the terms agreed to in the promissory note. A lender may take legal action to get the money back.