A loan is in default status when the borrower fails to fulfill the contract or agreement by not making installment payments when due or by not complying with other terms of the promissory note such as filing a deferment or cancellation request in a timely manner.

Once a borrower becomes 120 days past due on their Federal Perkins Loan, the following will happen:

1. The loan balance will be accelerated and due in full.
2. The default status of the loan will be reported to credit bureau organizations.
3. The borrower will lose the right to forbearance, deferment and cancellation benefits.
4. The borrower will lose the right to receive additional federal Title IV financial aid at UNO and other institutions.
5. The loan may be assigned to a professional collection agency and all costs involved with the collection of the loan will be assessed to the borrower. Collection costs can range from 30 – 50% of the loan balance placed with the agency.
6. The loan may be assigned to the United States Department of Education.
7. Holds are placed on University records that will prevent the borrower access to his/her transcripts, future enrollment and if applicable, diplomas.