Student loan forbearance can provide temporary relief from making payments on your student loans. Learn what it is and how it works in this guide.
If you’re struggling to make payments on your student loans, you may be able to apply for forbearance. This temporary relief allows you to pause or reduce your payments for a set period of time. But what exactly is student loan forbearance, and how does it work? Read on to find out.
Student loan forbearance is a temporary suspension or reduction of your monthly student loan payments. Here are some cases when you can get student loan forbearance:
Economic hardship forbearance: If you are experiencing financial difficulties and unable to make your monthly payments, you can apply for an economic hardship forbearance. This type of forbearance is typically granted for up to 12 months at a time, and you will need to reapply for each period of forbearance.
Medical forbearance: If you or a dependent have a serious illness or injury that prevents you from working or attending school, you may be eligible for a medical forbearance. This type of forbearance is typically granted for up to 12 months at a time, and you will need to provide medical documentation to support your request.
Military forbearance: If you are on active duty in the military, you may be eligible for a military forbearance. This type of forbearance is typically granted for the duration of your active duty service, plus an additional 180 days.
Natural disaster forbearance: If you have been affected by a natural disaster, such as a hurricane or earthquake, you may be eligible for a natural disaster forbearance. This type of forbearance is typically granted for up to 12 months at a time.
Teacher loan forgiveness forbearance: If you are a teacher and eligible for teacher loan forgiveness, you may be able to receive a forbearance while you are working toward the required number of years of service. This type of forbearance is typically granted for up to 12 months at a time.
It’s important to note that while forbearance can provide temporary relief from your student loan payments, interest will continue to accrue during the forbearance period. This means that you will likely end up paying more in the long run, so it’s important to carefully consider your options and only apply for forbearance if it’s truly necessary.
What is student loan forbearance?
Student loan forbearance is a temporary pause or reduction in your student loan payments. During forbearance, you are not required to make payments, but interest may continue to accrue on your loans. Forbearance can be granted for a variety of reasons, such as financial hardship, medical expenses, or serving in the military. It is important to note that forbearance is not a long-term solution and should only be used as a last resort.
How does loan forbearance work?
Student loan forbearance allows borrowers to temporarily pause or reduce their monthly payments on their student loans. During forbearance, interest may continue to accrue on the loans, which can increase the total amount owed. Forbearance can be granted for a variety of reasons, such as financial hardship, medical expenses, or serving in the military. It is important to note that forbearance is not a long-term solution and should only be used as a last resort. Borrowers should contact their loan servicer to discuss their options and eligibility for forbearance.
Who is eligible for loan forbearance?
Borrowers who are experiencing financial hardship, medical expenses, or serving in the military may be eligible for student loan forbearance. However, it is important to note that forbearance is not a long-term solution and should only be used as a last resort. Borrowers should contact their loan servicer to discuss their options and eligibility for forbearance. It is also important to understand that interest may continue to accrue on the loans during forbearance, which can increase the total amount owed.
Types of student loan forbearance.
There are two types of student loan forbearance: mandatory and discretionary. Mandatory forbearance is required by law and must be granted to eligible borrowers. Discretionary forbearance is granted at the discretion of the loan servicer and is not required by law. Examples of situations that may qualify for mandatory forbearance include serving in AmeriCorps, being in a medical or dental internship or residency, or being a member of the National Guard. Examples of situations that may qualify for discretionary forbearance include financial hardship, illness, or other reasons deemed acceptable by the loan servicer.
Pros and cons of loan forbearance.
While student loan forbearance can provide temporary relief from making payments on your student loans, it’s important to weigh the pros and cons before making a decision. One advantage is that it can provide breathing room during a financial hardship or other difficult situation. However, interest will continue to accrue during the forbearance period, which means you may end up paying more in the long run. Additionally, if you have a subsidized loan, the government will pay the interest during certain types of deferment but not during forbearance. It’s important to carefully consider your options and speak with your loan servicer before making a decision.