Failure to pay
Your payments and those of other borrowers are the primary source of loan funds
for current students. Failure to make your payments could jeopardize the University
of Minnesota’s eligibility for loan funds to support current and future
students. To protect the fund the University implements aggressive collection
efforts, including the use of collection agencies, litigation, revenue refund
recapture, and credit bureaus. Your student loan repayment is required even if you:
- are dissatisfied with the education you received;
- did not complete your program;
- cannot get a job in your field.
The University assesses monthly
late fees and places a hold on your academic records if you fail to make a payment
when due. A fee that is 20 percent of your monthly installment is added to the
balance due whenever you make a late payment. For example, if your installment
amount is $40 per month, the late fee will be $8 each month that your payment
is late.
If you pay with a check from a bank account that has insufficient
funds, SFC will assess the maximum charges allowed by law and apply the returned
check fee to your loan account. You will be notified to replace the check, plus
pay that fee.
If you fail to make loan payments, your loan will go into
default status. As required by federal law, the University will disclose your
loan default to a national credit bureau organization, along with other relevant
information. You default is also reported to NSLDS (U.S. Department of Education)
which prevents you from receiving further federal financial aid from any other
school.
Please do not hesitate to contact a Student
Financial Collections representative if you have concerns or questions about
your ability to repay your loans on schedule.
In the case of a dispute over the loan terms, you may seek resolution
by going to the OSFA Ombudsman’s Office at the U.
S. Department of Education Web site or contact them by calling 1-877-557-2575,
faxing to 202-275-0549, or writing:
U.S. Department of Education
FSA Ombudsman
830 First St NE
Fourth Floor
Washington, DC 20202-5144
