Repaying Your Loans: Deferment & Forbearance

The servicer can talk with you to see if you are eligible for a Deferment or Forbearance which could reduce or temporarily suspend your scheduled payment.  You will be required to complete paperwork with your loan servicer if you qualify for the Deferment or Forbearance status.  You should NEVER stop making payments until you have been placed in a status with the loan servicer, which allows you to not make payments.

Some Deferment conditions may be:

  • Enrolled at least half-time at an eligible postsecondary school
  • Study in an approved graduate fellowship program or in an approved rehabilitation training program for the disabled
  • Unable to find full-time employment (for up to 3 years)
  • Economic hardship (for up to 3 years) (this category includes Peace Corps Service)
  • A member of the National Guard or other reserve component of the U.S. Armed Forces (current or retired) who is called or ordered to active duty while enrolled at least half-time at an eligible school, or within 6 months of having been enrolled at least half-time.
  • While borrower is on active duty during a war or other military operation or national emergency and if the borrower was serving on or after October 1, 2007.

Forbearance allows you to postpone or reduce your scheduled monthly payment for a limited specified period of time.  A forbearance may be granted when you are temporarily not able to make your scheduled payment for reasons such as, financial hardship, illness, etc.  Interest accrues during the forbearance.  If you do not pay interest during the forbearance, interest will be capitalized (added to the principal balance) at the end of the forbearance period.

Students may prepay their loans at any time without penalty or you may request a shorter repayment schedule. 

Once you begin repaying your loans, if the accrued interest and any outstanding late charges have been paid, then any extra amount you pay above your regular required monthly payment will reduce the outstanding principal balance of your loans.