Repaying Your Defaulted Loan

• Rehabilitation
• Reinstatement
• Consolidation
• Repayment Terms
• Payment Methods

Rehabilitation
Rehabilitation is an option to remove your account from default. In addition to removing your account from default, TG will also delete its reporting of your default to the national credit bureaus. Upon completion of the rehabilitation program, you are given nine years to repay the remaining balance of your loans and up to 30 years to repay the remaining balance of your consolidation loan(s).

Note: Due to current market conditions in the student loan industry, specifically loss of all participating lenders, TG has suspended its rehabilitation program effective April 17, 2008. We are hopeful that this situation is temporary and that the program may be resumed in the near future. We encourage you to set up a repayment agreement with TG, so that if this program is resumed you will either meet, or be on your way to meeting, the eligibility requirements for the rehabilitation program.

• Eligibility Requirements
  You may not include in a rehabilitation agreement a loan on which a judgment has been obtained or on which you have been convicted of, or have pled nolo contendere or guilty to a crime involving fraud in obtaining federal student aid funds.
  
  To qualify:
  • You must agree to make nine, on-time, voluntary, full monthly payments. Payments obtained by state offsets or federal Treasury offsets, wage garnishment, trustee payments, or income or asset execution will not satisfy this requirement.
  • Your payment amount and due date must be approved by TG.
  • You cannot pay ahead or remit double payments in order to accelerate the rehabilitation process.
  • The account balance at the time of the rehabilitation must be at least $1,000.
    
    
• Rehabilitation Process
  • Once your account is set up for rehabilitation, a Default Rehabilitation Agreement will be mailed to you.
  • You fill out the Default Rehabilitation Agreement and return the agreement to TG.
  • Once you return the agreement, TG begins the rehabilitation process.
  • Once the payment criteria above have been met, a participating lender purchases the original loan(s) from default and you will continue to make monthly payments to the new lender.
  • Our current rehabilitation lenders are:
    
    
    • Nelnet/San Antonio Federal Credit Union*
      6420 Southpoint Parkway
      Jacksonville, FL 32216
      Phone: (888) 486-4722
      
      
    • NTHEA/EdFinancial*
      
      Payments
      Dept. 888055
      Knoxville, TN 37995
      Phone: (866) 333-5544
      
      Correspondence
      P.O. Box 31549
      Knoxville, TN 37930
      
      
  * Note: These are the lenders that were participating in our rehabilitation program at the time of its suspension. These lenders may continue with our program when market conditions improve.
  
  
• Rehabilitation Benefits
  • TG will remove the default from your credit report. (i.e. TG will no longer report your loan(s) or tradeline to the credit bureaus). Please allow 30-45 days for credit bureaus to update their records.
  • You will regain eligibility for applicable deferments and forbearances.
  • You will regain eligibility for additional federal student aid provided that you have no other student loans in default.
  • You will be given the same maximum repayment period you received when you initially took out the loan, minus nine months (i.e., the nine monthly payments you made to qualify for rehabilitation). You will retain the original terms and interest rate of the loan(s).

For more information on the Rehabilitation program, call TG at (800) 222-6297 or send us an e-mail message.

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Reinstatement
If you default on your TG loan, you must make satisfactory repayment arrangements and make six consecutive, on-time, full, voluntary monthly payments to the holder of your defaulted loan before you will be eligible for additional federal student aid. After you meet these qualifications, TG will send appropriate notification to your school, upon request.

Once your eligibility has been reinstated, you must remain current throughout the repayment of your loan. If you do not remain current, you are no longer eligible for federal student aid until your defaulted loans are paid in full.

For more information on how to set up repayment arrangements and/or request reinstatement of your eligibility for financial aid, call TG at (800) 222-6297 or send us an e-mail message.

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Consolidation
Consolidation allows you to get out of default by combining your existing federal student loans into one new loan.

The original loans are paid in full and a new loan for the combined balance is originated. The length of repayment is determined by the balance of your loans at the time of consolidation. See the Repayment Terms section below for a chart on the repayment terms. The interest rate of the consolidation loan is determined by taking the weighted average of the interest rates on your existing loans, rounded up to the nearest 1/8th percent (0.125%).

• Eligibility Criteria
  A defaulted loan may be consolidated, provided that the borrower is not subject to a judgment secured through litigation or an order of administrative wage garnishment on a federal loan.
  
  In order for a borrower to qualify for a Consolidation loan, he or she must:
  • Certify (at the time of application) that he or she does not have another Federal Consolidation loan application pending.
  • Make satisfactory repayment arrangements with the holder of each defaulted loan that the borrower wishes to consolidate, or agree to repay the consolidating lender under an income-contingent repayment plan.
  • Repay in full any ineligible amount previously borrowed prior to the consolidation, if due to borrower error.
  
  
  
• Satisfactory Repayment Arrangements
  For the purposes of Consolidation, a defaulted borrower must make satisfactory repayment arrangements on the defaulted loan(s) and make three consecutive, on-time, voluntary, full monthly payments.
  
  
• Eligible Loans
  • Federal Family Education Loan Program (FFELP) loans (Stafford, PLUS, SLS and Consolidation loans)
  • Federal Perkins Loans
  • Health Professions Student Loans (HPSL)
  • Health Education Assistance Loans (HEAL)
  • Nursing Student Loans (NSL)
  • Federal Direct Loan Program (FDLP) loans (Stafford, PLUS, SLS and Consolidation loans)
  • Federal Insured Student Loans (FISL)
  
  
• Consolidation Benefits
  • A lender must offer the borrower the choice of repaying the loan under a standard, graduated, income-sensitive or, if applicable, an extended repayment schedule.
  • The borrower may request to change his or her repayment terms on an annual basis.
  • The borrower may be eligible for deferments and forbearances, if needed.
  • Some borrowers will qualify for interest subsidy during authorized periods of deferments.

Please contact us to see if you qualify for consolidation. For more information on consolidation, call TG at (800) 222-6297 or send us an e-mail message.

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Repayment Terms For Defaulted Loan Borrowers
The following repayment terms may be available:

• Payment in full. By paying the balance in full you will save paying additional interest and collection costs. You will avoid other consequences of default including Treasury offset and wage garnishment. By paying in full, you will immediately bring your loan out of default and your credit report will be updated to show "Paid-in-Full".
  
  
• Standard repayment for balances up to $7,500 is a 10-year repayment term. Try our repayment calculator to determine possible monthly payment amounts.
  
  
• Longer repayment terms may be available on balances that exceed $7,500. See the repayment chart below for more details.

  $7,500 to $9,999	12 years
  $10,000 to $19,999	15 years
  $20,000 to $39,999	20 years
  $40,000 to $59,999	25 years
  $60,000 and above	30 years

  
  
  

• Reasonable and Affordable repayment is a temporary schedule where your monthly loan payment is based on your income. You will be required to provide certain documentation of your income and expenses in order to determine a reasonable and affordable payment amount. To see if you qualify, download, complete and return TG's Reasonable and Affordable Financial Disclosure form.

For more information on repayment terms, call TG at (800) 222-6297 or send TG an e-mail message.

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Payment Methods
TG accepts many forms of payment for your defaulted student loan. The various payment methods are listed below:

• Check, Money Order, or Cashier's Check via:
  
  
  • Payment Address:
    P.O. Box 659602
    San Antonio, Texas 78265-9602
    
    
  • Overnight delivery:
    3500 Wadley Place
    TG Mail Center, Ste. 303
    Austin, Texas 78728-1244
    
    
  • In-person or drop box located in our lobby
    301 Sundance Pkwy.
    Round Rock, Texas 78681
    
    

• Western Union Phone Pay is $2.00 per transaction. This allows TG to draft a one-time payment from your checking account. This process may take up to two business days to post to your account. Have your bank account information ready when you contact us.
  
  
• Western Union Quick Collect is $12.95 per transaction. This process can be posted to your account the same day as the transaction if received in our office before 2 p.m. Central Standard Time. Locate a Western Union office near you. (Our code city is TGSLC and our code state is TX.)
  
  
• Autodraft is an automatic withdrawal from your checking account each month. There is no fee to establish autodraft service and your payment can be drafted on the 1st, 8th, 15th, or 25th of each month. Your account must be current to participate in this program.
  
  
• Bank-to-Bank wire transfer is an electronic funds transfer from your bank account to our bank account. TG does not charge for this service; however, your bank may charge you a fee. Please contact us for wiring instructions.

For more information on payment methods, call TG at (800) 222-6297 or send us an e-mail message.

For non-payment correspondence, please use TG's general correspondence address: P.O. Box 83100, Round Rock, TX 78683-3100.

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