Student loan default impact on co-signer

Putting a downpayment on an account will not stop them from suing. Only paying in full or a settlement will.

Why do they sue? To protect themselves. With a judgement, they lien homes, garnish wages (if state law permits it) and empty bank accounts. They show no mercy.

Thanks for your help. If they take me and my co-signor to court is it possible to still settle/do a payment plan at that point? If my co-signor receives a pension from a state/local govt can they garnish that? Also are they inclined to empty your bank account if you are willing to do a payment plan?

Settlements once sued are usually not a generous because court and legal fees are applied to your account. That can add an aditional $1500-$2000 to your account.

Even making payment they can still wipe out payments. That is the power of a judgment. Whether or not they can seize a private pension would depend on your state exemptions.