Default is the term referring to the situation when a borrower does not pay back the loan according to the agreement on the loan. If you take out an education loan and do not pay back the loan, you will be considered in default.

Lenders usually allow some grace for educational loans, and do not put a loan in default at the first instance when the loan's monthly payment is not made. But do not make a habit of being late on your loan payment. If your education loan ends up in default, you will have a negative mark on your credit score, which could make it difficult for you to receive further loans in the future.

When applying for a loan, make sure that you will be able to make the monthly payments. This can be difficult to determine, especially if you are not aware of what your potential income will be. Try to only what you absolutely have to have, and nothing more.

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