A student loan is a credit creation provision that aids students with adequate finances to pay tuition fees of universities or other educational institutes. These loans are often aided by grants, availed by government departments. In some cases, students also receive scholarships on the basis of his or her academic achievement, that can be used to dilute the financial pressure of the students loan. In some other cases however, the whole burden of the loan remains on the student themselves. When a student loan is sanctioned by a lender, a contract is created, to which the lender and student are a party. According to the contract, student has to repay the loan and interest in a specified time period. Some lenders start the repayment period immediately after the loan has been sanctioned, while others prefer to wait, till the student's education is complete. If the student fails to repay the loan within the prescribed time period, then the student is considered to have defaulted the loan. In some countries, separate laws concerning default of a loan have been enforced. According to most of these laws, if a borrower (in this case the student) fails to make any payment in 270 days, the loan is considered to be a default. Consequences of a Default A student who has borrowed a loan, has to always bear in mind that, this loan should never declared as a default in case of insolvency. Only, lack of payment or breach of contract makes it a default. There are several consequences of a students loan default. The first being, credit history of the student is affected. Often, small-scale lenders often increase cost of credit, by increasing collection fees or by enforcing a late payment penalty. How to Recover from a Default One of the safest and also the most difficult way to recover a default, is to start saving up. The process of saving up is rather lengthy and also patience testing. You can supplement the process by an extra part-time job, like working in a coffee shop in your free time. You can also sell some asset that you no longer use. This process of saving up, is very long and difficult, but it is useful. Another option that is convenient, is to avail another secured loan and pay off the students loan. In this manner you can avoid the collection fees and later penalties. To avail this kind of loan you will need a sound credit history, and the interest charged will also be high. In some nations, monthly installments of a loan can be clubbed with the tax that is paid. This is possible if the bank or lending organization is well spread and nationally recognized. Another loan that can be borrowed is a consolidation loan. If a student is in debt to any other lender, like a credit card company or another loan, then the consolidation loan is the best option. The student consolidation loan is used to pay off all current debts. The consolidation loan is a long-term loan with a longer period than usual loans, and a low rate of interest. Most of the consolidation loans are secured loans, meaning that they have to be backed by a collateral. This loan also improves the credit history of the borrower, as all the debts are wiped off. The best option and remedy to avoid a default in student's loan, is to study hard and get good grades and scores, which will fetch a very good job, with a high salary that will help to repay the debt.