If you're in default on a Federal student loan, you can pay your student loan with a credit card. Currently, the Department of Education accepts American Express, Visa, Mastercard, and Discover.
If your loan is from a private lender, they're under no obligation to let you pay your student loan with a credit card. You should check with them on their individual policies.
To make a credit card payment on your defaulted Federal loan, you can call 1-800-621-3115, Monday through Saturday.
Before you whip out the plastic, it is important to keep in mind some of the major drawbacks of paying off your student loan with a credit card.
- The interest rate may end up being 2-4 times as much as your student loan, which will make that credit card even harder to pay off.
- You cannot request a hardship forbearance on your credit card, but you may be able to on your student loan.
- Your credit card interest is not going to be deductible on your tax return, but your student loan interest potentially is.