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Chapter 4: Deferment and forbearance

If you find yourself unable to pay your student loans, or anticipate difficulties in the future, don’t hide your head in the sand. For federal student loans, you may be able to get relief with a deferment or forbearance. (Private lenders may also offer them, but they are not required to do so.) A deferment is a temporary suspension of payments. If the loan is subsidized, the interest will be suspended; if not, interest will continue to accrue. (You can either pay it or add it to the loan balance.)

Deferments are only permitted under certain circumstances, including:

  • enrollment as at least a half-time student
  • temporary total disability
  • enrollment in a graduate fellowship program
  • unemployment or other economic hardship
  • active duty in the armed forces
  • participation in a rehabilitation program for the disabled


Forbearance is similar to deferment, only interest continues to accrue regardless of whether your loan is subsidized. (Forbearance can also involve a temporary acceptance of smaller payments.) Forbearances are granted for such reasons as a high monthly payment relative to your income, medical hardship, or other unforeseen personal problems. If you have subsidized loans, obviously a deferment is preferable, but a forbearance is generally easier to obtain.

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