How to Get a Deferment on Student Loans
Discover how to temporarily suspend your student loan payments. This guide simplifies the deferment process, from qualification to successful application.
Discover how to temporarily suspend your student loan payments. This guide simplifies the deferment process, from qualification to successful application.
Student loan deferment offers a temporary suspension of loan payments for individuals facing specific circumstances. This arrangement provides financial relief, allowing borrowers to address immediate challenges without monthly student loan payments. Deferment differs from forbearance primarily in how interest accrues; during deferment, interest typically does not accrue on certain types of federal student loans, which can reduce the overall cost of the loan. It is a formal process that requires an application and proof of eligibility.
Eligibility for student loan deferment hinges on meeting specific criteria tied to various life events. Federal student loans offer several deferment options, each with distinct requirements. An in-school deferment is available if a borrower is enrolled at least half-time at an eligible college or career school. This deferment is often automatically applied, but borrowers should confirm with their school and loan servicer.
Unemployment deferment is an option for those actively seeking full-time employment or receiving unemployment benefits. This deferment can be granted for up to three years, often in six-month increments, requiring reapplication to extend.
Economic hardship deferment is for borrowers facing financial challenges. Qualification can stem from receiving means-tested federal or state public assistance, such as Temporary Assistance for Needy Families (TANF) or Supplemental Nutrition Assistance Program (SNAP) benefits. Individuals working full-time but earning below 150% of the poverty guideline for their family size may also qualify. Peace Corps volunteers are also eligible for this deferment, which typically lasts up to three years but requires annual reapplication unless serving in the Peace Corps.
Military service deferment is available for those on active duty. This deferment covers the duration of active duty service and, for students, an additional 13 months following completion or until re-enrollment in school at least half-time. Other deferment types include graduate fellowship deferment for those enrolled in approved programs and rehabilitation training deferment for individuals in qualifying vocational, drug, mental health, or alcohol abuse treatment programs. A cancer treatment deferment allows a pause in payments during active treatment and for six months thereafter, requiring physician certification. Parent PLUS loan borrowers may also qualify for deferment if the student for whom the loan was taken is enrolled at least half-time.
For private student loans, deferment options are not standardized and are at the discretion of the individual lender. Borrowers should contact their loan servicer to inquire about available programs, as terms and eligibility criteria vary. Interest generally continues to accrue on private loans during any deferment period.
Borrowers must prepare the necessary application. Official deferment forms are typically accessible on the Federal Student Aid website or through the loan servicer’s website. Select the correct form for the specific deferment requested to avoid delays.
For an in-school deferment, enrollment verification from the educational institution is necessary. For unemployment deferment, this might include statements proving receipt of unemployment benefits or records demonstrating efforts to find full-time employment.
Economic hardship deferment often requires proof of eligibility for means-tested benefits, such as an award letter for SNAP or TANF. Income documentation like recent pay stubs or federal income tax returns may be needed to verify income against poverty guidelines. Military service deferment applications necessitate official military orders or a letter from a commanding officer confirming active duty status.
For a cancer treatment deferment, a physician’s certification confirming active treatment is required. Complete all informational fields on the chosen deferment form accurately. Missing or incorrect details can lead to processing delays or rejection.
After completing the deferment form and gathering documentation, submit the request to the loan servicer. Common submission methods include online portals, mailing, or faxing. Retain copies of all submitted materials for personal records.
Anticipate a processing period after submission. Borrowers may contact their servicer after two to three weeks to confirm receipt and inquire about the application status. Continue making scheduled loan payments until the servicer officially notifies approval. Failure to do so could result in loan delinquency or default if the deferment is not granted.
During the deferment period, the impact on the loan varies by type. For federal Direct Subsidized Loans and Perkins Loans, interest typically does not accrue. For federal Direct Unsubsidized Loans, Direct PLUS Loans, and most private loans, interest continues to accrue. If accrued interest is not paid during deferment, it is often capitalized, meaning it is added to the principal balance, increasing the total amount owed.
When the approved deferment period concludes, the loan servicer will send a notification outlining the upcoming resumption of repayment. Borrowers should be prepared to restart payments promptly. Some federal loans, such as Perkins Loans, may offer an additional post-deferment grace period before payments are due again.