The student loan forbearance options allow you to temporarily pause payments during financial difficulties. These programs can provide relief when you encounter financial hardships. For example, losing your job may make it difficult to continue making your monthly loan payment.
What is student loan forbearance?
Student loan forbearance is a temporary suspension or reduction of student loan payments. During the forbearance period, you are not required to make any payments toward the principal on your student loans. Interest may continue to accrue on your loans and will be added to your balance at the end of the forbearance period.
Who provides student loan forbearance?
The U.S. Department of Education offers student loan forbearance for eligible federal loans. You may be wondering about your options if you have private student loans. It is not necessary for private lenders and servicers to offer student loan forbearance, but many do provide options for borrowers who are unable to pay. According to Mark Kantrowitz, publisher and vice president of research at SavingforCollege.com, some private lenders offer partial forbearance, where the borrower only pays interest during the forbearance period.
Forbearance vs. deferment
Forbearance is another option for temporarily pausing student loan payments. You can apply for forbearance if you qualify for federal loans, including Direct Loans, FFEL loans, and Perkins Loans. Forbearance periods can last up to 36 months.
Advantages and disadvantages of student loan forbearance
Putting your student loan payments on forbearance comes with both advantages and disadvantages.
How to get student loan forbearance
If you are interested in applying for student loan forbearance, you will need to contact your lender or loan servicer.
Conclusion
If you are having trouble keeping up with your student loan payments, the best thing you can do is reach out to your lender or loan servicer. Explaining the details of your financial situation can help you avoid late or missed payments and potential damage to your credit record, while exploring options to make your loans easier to manage and perhaps less costly in the long run.
Frequently Asked Questions
What is the difference between forbearance and deferment?
Will forbearance affect my credit score?
What if I cannot afford loan payments but do not qualify for forbearance?
Sources:
U.S. Department of Education. “The Biden-Harris Administration continues the fight for student debt relief for millions of borrowers, extending student loan repayment forbearance.”
Federal Student Aid. “Student loan forbearance allows you to temporarily pause payments.”
Twitter. “@POTUS, August 24, 2022, 11:32 AM.”
Federal Student Aid. “Loan forbearance and delinquency.”
Federal Student Aid. “Don’t give up if you’re delinquent on your federal student loan.”
Federal Student Aid. “Student loan forbearance allows you to temporarily pause payments.”
Federal Student Aid. “Understand how to calculate the interest and fees associated with your federal student loan.”
Source: https://www.thebalancemoney.com/what-is-student-loan-forbearance-4892767
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