Sometimes it can feel like your student loans are ruining your life. You can’t buy the next hot trend (bye bye, personal-stylist subscriptions or shiny new rims) or go out for dinner at the hip, new restaurant in town. Instead of eating avocado toast, you’re stuck eating buttered toast. You thought college would bring you so much freedom and joy. Instead, your student loans have imprisoned you in a cage of unbearable payments. And it can get worse. Maybe you’re struggling to even buy normal buttered toast. Maybe you’ve lost your job and are trying to figure out how to make your monthly student loan payments while getting out of an unemployment rut. If you’re struggling to make your student loan payments, you may be able to find a brief safe haven with student loan deferments.
What are student loan deferments?
Student loan deferments are periods of time when your lender excuses you from making payments because of specific circumstances in your life (e.g., economic hardship, unemployment, returning to school, military deployment). Essentially, you don’t have to make a payment on your federal student loans while you’re in deferment.
Now, this does mean that you won’t be making progress toward forgiveness or repaying your loan. But it can definitely be the helping hand you need, especially if you’re about to go into default or just going through a rough patch.
Deferment is one of the biggest perks of having a federal student loan. Some private student loans do offer their own deferment programs. However, these are generally more limited than federal student loan deferments.
What makes a deferment different from forbearance?
With a deferment, you are not responsible for paying any interest that accrues on certain types of federal loans while they are in deferment. These types of loans are:
- Direct Subsidized Loans
- Subsidized Federal Stafford Loans
- Federal Perkins Loans
- The subsidized portion of Direct Consolidation Loans and FFEL Consolidation Loans
You will still be responsible for paying interest that accrues on these types of loans during the deferment period:
- Direct Unsubsidized Loans
- Unsubsidized Federal Stafford Loans
- Direct PLUS Loans
- Federal Family Education Loan (FFEL) PLUS Loans
- The unsubsidized portion of Direct Consolidation Loans and FFEL Consolidation Loans
With forbearance, any and all federal student loans (both subsidized and unsubsidized) will accrue interest. For this reason, it is generally harder to get a deferment than it is to get a forbearance.
Who is eligible for deferment?
You can be eligible for student loan deferments if you are:
- Unemployed or unable to find full-time employment (for up to three years)
- Experiencing economic hardship or serving in the Peace Corps (for up to three years)
- Enrolled in an approved rehabilitation training program for the disabled
- On active duty military service in connection with a war, military operation, or national emergency
- Someone who was on active duty military in connection with a war, military operation, or national emergency (for the 13 month period after the conclusion of that service, or until you return to college or career school, whichever is earlier)
- Enrolled in an approved graduate fellowship program
- Enrolled at least half-time at an eligible college or career school, and if you received either a Direct PLUS Loan or FFEL PLUS Loan as a graduate or professional student (for an additional six months after you cease to be enrolled at least half-time)
- A parent who received a Direct PLUS Loan or an FFEL PLUS Loan, while the student for whom you obtained the loan is enrolled at least half-time at an eligible college or career school (and for an additional six months after the student ceases to be enrolled at least half-time)
About 7.5% of borrowers are currently in deferment, so it’s definitely a viable option if you meet one of the eligibility criteria above.
How do I request a student loan deferment?
Deferments are almost never automatic – though it would be nice if your servicer could read minds and give you a break when needed. The only exception here is if you are enrolled in an eligible college or career school at least half-time. In this case, your servicer will automatically place your loan into a deferment and will notify you. If you are enrolled in an eligible college or career school at least half-time and you don’t receive a notification of deferment, you’ll want to contact your school. Your school will then send your enrollment information to your servicer so they can place your loan into deferment.
To request a deferment, you’ll have to apply directly to your loan servicer. You can find your loan servicer and their contact information through the National Student Loan Data System (NSLDS). Most servicers require forms and other documentation to show you meet the eligibility requirements.
Remember, even if you’ve submitted a request for deferment, you must keep repaying your student loan until you’re notified that you received a deferment. You do not want to default on your loan while waiting for a deferment that you may not get.
What if I’m not eligible for student loan deferments?
If you’re not eligible for deferment, you can always apply for forbearance. Forbearance is typically easier to receive than deferments. Forbearance also typically has a shorter time limit than deferments, generally around 12 months. You’ll have to apply for forbearance through your servicer.
And remember, deferment is only temporary. So if you feel like you won’t be able to keep paying even after your deferment, know that there are more options out there for you.
Disclaimer: The viewpoints and information expressed are that of the author(s) and do not necessarily reflect the opinions, viewpoints and official policies of any financial institution and/or government agency. All situations are unique and additional information can be obtained by contacting your loan servicer or a student loan professional.