Student Loan Default & Passport Denial

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Stanley Tate

#1 Student Loan Lawyer

Updated on January 21, 2023

Defaulting on a student loan may sound like a death sentence for your travel plans, but it’s not. The State Department won’t deny a U.S. passport application for defaulted federal student loan debt. It also won’t revoke an existing passport.

Under the Passport Denial Program, the federal government will deny or revoke your application if you owe unpaid back taxes to the IRS or over $2500 in past-due child support payments.

Related: Passport Denial Reasons

But just because your passport isn’t at risk doesn’t mean missing student loan payments is a good idea. Student loan default can still ruin your credit, lead to wage garnishment, and put your tax refund and Social Security benefits at risk.

If you’ve fallen behind in payments and are in default, now is the time to do something about it.

Related: How to Get Student Loans Out of Default

How to discover if your passport is on the denial list

Keep track of your passport application status easily by visiting the State Department’s website.

Status updates for passport applications and renewals are typically available 14 days after submission and can be found by searching for the applicant’s information.

The status of the application can be one of: “Not Found,” “In Process,” “Approved,” or “Mailed.” The website also allows you to sign up for automatic email updates by entering your email address.

You can also check your application status by calling the National Passport Information Center at 1-877-487-2778 during the center’s operating hours of Monday through Friday from 8 a.m. to 10 p.m. Eastern Time, excluding federal holidays.

The center also provides an automated passport information system available 24 hours a day.

Borrowers with defaulted federal loans can start fresh

Last year, the U.S. Department of Education released a plan to help nearly 8 million Americans in default the opportunity to re-enter repayment in good standing through the Fresh Start initiative.

This program aims to help borrowers avoid the hassle of traditional loan rehabilitation or consolidation.

One of the major benefits of the Fresh Start initiative for borrowers is the ability to have their loans returned to “current” status on their credit reports and remove negative default marks.

Also, borrowers will regain access to federal student aid and other government loans, such as mortgages, and have access to flexible repayment plans like income-driven repayment and short-term relief options like deferment or forbearance.

Furthermore, collection efforts on defaulted loans — income tax refund offset, wage garnishment, etc. — will be suspended under the initiative, even after the current student loan payment pause ends.

Borrowers will also regain eligibility for financial aid and loan forgiveness programs such as Public Service Loan Forgiveness and income-based repayment forgiveness.

How to get a Fresh Start

To take advantage of the Fresh Start program, you must first make payment arrangements with the Education Department’s Default Resolution Group or their loan holders.

After a long-term affordable payment plan is agreed upon, your loans will be moved to a new loan servicer within a few weeks, according to the StudentAid.gov website.

Bottom Line

While denial, revocation, and restriction of a US passport are a concern for those with delinquent tax debt and child support areas, student loans won’t stop you from getting a passport.

The U.S. government doesn’t block passports for unpaid student loans. Still, it can have severe financial consequences.

The Fresh Start program is a chance for you to get back on track and regain access to flexible repayment plans and loan forgiveness programs. Take advantage of the program as soon as possible.

UP NEXT: Can I Still Apply for Student Loan Forgiveness?

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