What Is School Deferment for Student Loans and Who Qualifies?
Learn how school deferment for student loans works, who qualifies based on enrollment status, and how it affects interest and repayment timelines.
Student loan payments can be a financial burden, especially for those returning to school. Borrowers may qualify for school deferment, which temporarily postpones payments while they are enrolled in an eligible program.
Qualifications Based on School Enrollment
To qualify, borrowers must be enrolled at least half-time in an eligible institution. For undergraduate students, this typically means at least six credit hours per semester, though requirements vary by school. Graduate students may have different thresholds. Schools report enrollment status to loan servicers, but borrowers should verify their status to avoid unexpected payments.
Only institutions recognized by the U.S. Department of Education qualify, including most universities, community colleges, and some vocational programs. Non-degree programs, such as certificate courses, may not always meet the requirements unless part of a degree-granting curriculum. Borrowers attending foreign schools should check if their institution is approved for federal student aid, as not all international programs qualify.
Graduate fellowship and residency programs may also qualify if they provide structured training and require full-time participation. Borrowers should confirm with their loan servicer whether their specific program meets the criteria.
Eligible Loan Categories
Not all student loans qualify for school deferment. Federal Direct Loans, including Subsidized and Unsubsidized Loans, are generally eligible if the borrower meets enrollment requirements. Federal PLUS Loans, taken out by graduate students or parents on behalf of undergraduates, also qualify, though parent borrowers must request deferment separately.
Older federal loans issued under the Federal Family Education Loan (FFEL) Program, though no longer issued, remain eligible under the same enrollment conditions. Perkins Loans, discontinued in 2017, still allow deferment for borrowers who previously received them. Since Perkins Loans are managed by individual schools, borrowers should contact their institution’s financial aid office to process deferment requests.
Private student loans do not have standardized deferment policies. Some lenders offer deferment, while others require continued payments regardless of enrollment status. Borrowers should review loan agreements or contact their lender to confirm availability and terms. Some lenders allow full postponement but continue accruing interest, while others may require interest-only payments.
Interest Accrual and Billing
While school deferment suspends required payments, interest may still accumulate. Federal Direct Subsidized Loans do not accrue interest during deferment, as the U.S. Department of Education covers these costs. Direct Unsubsidized Loans and PLUS Loans, however, continue accruing interest, which is added to the principal balance once deferment ends, increasing the total repayment amount.
Private student loans vary in how they handle interest during deferment. Some lenders allow full postponement but still apply interest charges, while others may require interest-only payments. Borrowers should review loan agreements to understand their total repayment obligation. Those with compounding interest should consider making voluntary payments to limit long-term costs.
How to Submit a Deferment Request
Borrowers should confirm eligibility with their loan servicer before submitting a deferment request. The official request form is available on the servicer’s website or through customer service. Completing the form accurately is essential, as errors or missing information can cause delays or denial.
Most applications require certification from the school’s registrar, verifying enrollment status and expected graduation date. Some institutions participate in the National Student Clearinghouse, which automatically reports enrollment to loan servicers. However, discrepancies between school records and servicer databases can result in missed deferment periods. Borrowers should confirm that their servicer has received and processed their request.
If deferment is denied, borrowers can appeal by providing additional documentation, such as a letter from the institution confirming enrollment. If deferment is still not granted, alternatives like income-driven repayment plans or temporary forbearance may help manage payments.