You Missed a Student Loan Payment. Now What?

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Imagine the scenario. You wake up one morning without a worry on your mind. Then you look at your calendar and realize you did not pay your student loan payment, and it was due three days ago. Or perhaps you didn't catch your mistake quickly enough, and you are getting notices in the mail.

Don't panic!

While your first reaction might be to overreact and hyperventilate, know that it is not the end of the world. As long as you can restore your student loan account from delinquency to repayment status quickly, you will be fine.

Here's what you need to know and what you should do when you miss a student loan payment.

Call Your Lender Right Away

First things first, call your lender. You do not need to come up with an elaborate story or excuse. Just explain what happened. Many lenders have generous grace periods, and some private lenders might not have a grace period at all.

Once you have your lender on the phone, you can ask them if your late payment has subjected you to any late fees or has been reported to your credit union. Arrange to make payments over the phone, even if you have to pay a small fee to do so. You want to make sure that the lender gets their payment immediately.

If your late payment has been reported to the credit bureaus, it can put a ding on your credit score for several years. You can attempt to have the report taken off by writing a request to your lender. In your request, you can mention that you are trying to improve your credit for an upcoming home or vehicle purchase and that the late payment was a rare case due to certain circumstances. There is no guarantee that this will work, but it is worth attempting. (See also: 8 Tax Tricks to Try if You're Stuck With Student Loans)

How to Avoid Missing Another Student Loan Payment

If you missed your student loan payment because you just forgot or because you have too many student loans to keep track of, here are two solutions that will help.

1. Consolidate or Refinance Your Loans

If you have several different student loans, and you are not going to apply for loan forgiveness, consider consolidating your loans to have all of your debt in one loan. Consolidating your loans might even lower your interest rate and monthly payments.

2. Schedule Automatic Payments

Another sure way to never miss your student loan payment again is to schedule monthly automatic payments. Some lenders will even offer you a discount APR if you sign up for automatic payments through their site.

What If You Can't Afford Your Student Loan?

If you are having difficulties adhering to the monthly payment deadline because you are short on cash, then you need to get help immediately. The last thing you want is for your loan to default. Attorney Daniel Gamez says, "Once a federal student loan goes into default, borrowers face potential wage garnishments of up to 15% of their wages. That can be crippling if you are already on a tight budget."

Review your payment options with your lender. You might qualify for deferment or forbearance, depending on your current situation. If you have federal loans, look into options for repayment, such as:

• Extended Payment Plan, which lowers your monthly costs by extending your loan up to 25 years.
   
• Revised Pay as You Earn Plan (REPAYE), which makes your monthly payments 10% of your discretionary income.
   
• Income-Based Repayment, which calculates your monthly payments each year based on your income and family size, not to exceed 15% of your discretionary income.
   
• Income-Sensitive Plan, which bases your monthly payment on your annual income and can extend your loan up to 15 years.

Have you run into problems with your student loans? What did you do?