OAR 575-050-0035
Default
(1)
A loan shall be judged to be in default upon the occurrence of any one or more of the following conditions:(a)
Failure of the borrower to acknowledge the Schedule of Payments within 60 calendar days following graduation or termination;(b)
Failure of the borrower to fully remit two consecutive quarterly installments of accruing interest or failure to fully remit a monthly installment of accruing interest which is due for more than 120 days;(c)
Failure of the borrower to fully remit any other installment which is due for more than 120 days; or(d)
Borrower is adjudicated a bankrupt.(2)
The holder of a note may exercise the right of offset against any maker or co-maker of defaulted loans under the conditions set forth by the laws of the State of Oregon. The maker or co-maker shall pay any charges for assistance in exercising the right of offset incurred by the holder of the note(s).(3)
From funds available, therefore, the Commission shall reimburse the Division for any loss resulting from default of a loan. The Commission shall then take the action necessary for the recovery of those funds.(4)
A five percent collection charge shall be assessed against all loans that are judged to be in default. This charge will be assessed by the Commission for the actual servicing and collection of defaulted loans and is based on the amount paid to the previous holder of the note(s). The maker or co-maker shall pay all charges incurred should the note(s) be referred to an outside collection agency.(5)
The application of offsets to a defaulted loan(s) shall not be credited to future payments nor be a substitute for regular monthly installments.(6)
The prepayment of a portion of a defaulted loan(s) shall not be credited to future payments nor be a substitute for regular monthly installments.
Source:
Rule 575-050-0035 — Default, https://secure.sos.state.or.us/oard/view.action?ruleNumber=575-050-0035.