A student who has stopped paying back their private loan implies their account has actually defaulted. When a student purposefully stops their payments, it is regarded as a strategic default.
Often a student may find that after many years of paying back their loan, the unsettled balance hasn't minimized very much. In some cases the unsettled balance really increases thanks to the high interest rates.
This is why some students will contemplate a strategic default. Sometimes there appears to be no other attainable option. This strategy is ideally suited to those who are likely going to be late on their payments. Nevertheless, it is something that increasingly more students are considering because of the very restricted payment alternatives readily available to them.
This choice to strategically default is one that needs to be taken very seriously. No upstanding counselor can advise you as to whether you ought to proceed down this route or otherwise. The student must consider all the advantages and disadvantages before all else.
We have created this practical infographic to help provide some information that should ideally make your decision simpler.