Deferment
and forbearance are the terms used for postponing your student
loan payments.
Deferment
is when you are postponing your payments for a specific period
time for a specific reason. Deferment is are not automatic;
you must apply for deferment through your lender. Here are some
reasons you might be granted a deferment:
Enrollment
in school at least half time
Graduate
fellowship
Rehabilitation
training
Unemployment
Economic
hardship
Forbearance
is another way to postpone your student loan payments if you are
not eligible for a deferment. There are four specific reasons
why you can be granted forbearance:
Discretionary: Can be granted for any reason agreed upon between
you and your lender (e.g., returning to school less than half
time and not eligible for deferment).
Administrative: Can be granted by your lender for specific
reasons without your written authorization (e.g., loan payments
were behind at the time a deferment was granted).
Mandatory: Must be granted by your lender for specific reasons
if you request, for a specific length of time (e.g., your
loan payments equal more than 20 percent of your monthly gross
income). A mandatory forbearance can be granted for no more
than 12 months.
Mandatory Administrative: Must be granted by your lender for
specific reasons (e.g., you are not able to repay using an
income-sensitive repayment schedule within 10 years because
of changes in the variable interest rate). A mandatory administrative
forbearance can be granted for no more than 36 months.
To
be granted a forbearance, you must speak to your lender regarding
the above options. If you do not know who your lender is, you
can call the Federal Student Aid Information Center at 1-800-433-3243
or go to www.nslds.ed.gov
with your PIN.
