The recession seems to be bringing an almost constant stream of stories about people in all sorts of circumstances who are facing new and varied financial troubles. These stories could easily be read as a guide for "things not to do in a recession." The latest addition? "Default on your student loans."
While neglecting even one payment is a bad idea at any time, borrowers who have found themselves in default on their loans are facing an even more difficult time as a result of the credit freeze. The Chronicle of Higher Education published a story today about this particular aspect of the trouble facing participants in the Federal Family Education Loan Program. Currently, 19 of the nation's 35 guarantee agencies (the companies that service student loans in the FFEL program) [...]