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You may have heard of student loan deferment, but you aren't quite sure what the deferment process means. If you are already paying back your student loan debt or are fixing to pay back your student loans, then you may want to understand the deferment process and what it can do for your loans.

Deferment simple means that you are temporarily postponing making your student loan payments. However, while you may be able to temporarily suspend your payments, the interest on your student loans may continue to accrue depending on what type of deferment is chosen. There are several types of deferment.

Types of Deferment

Military deferment is the temporary suspension of monthly student loan payments while you are serving in the military on active duty.

In-school deferment occurs when you are in school. You must be enrolled at the very least as a half-time student, which is 9 hours for undergraduates and 4 hours for graduates.

Deferment due to economic hardship is when you can have your student loan payments suspended if you are unable to make payments due to financial hardship.

A forbearance is granted when you may not qualify for a deferment. A loan in forbearance will continue to accrue interest.

Is a Deferment Right for You?

If you are trying to determine if a deferment is right for you, there are some things you need to consider. Some types of deferment will continue to accrue interest whether you are making payments or not. However, subsidized students loans, don't generate interest during the deferment. The government usually the entity covering the interest payments during this time.

It's also wise to only use a deferment or forbearance when you cannot or are not ready to make your student loan payments. There is only a limited amount of time in which you can use a deferment or forbearance. It might be a good idea to make the payments when you can, while keeping a deferment or forbearance as a safety net to use in hard economic times. You can also use several months of deferment or forbearance at different intervals. In other words, use as few months as possible.

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Student loan deferment is a temporary pause in making loan payments. It is typically granted for specific reasons such as returning to school, economic hardship, or military service. During deferment, interest may still accrue on certain types of loans, but it will not be capitalized. It is important to contact your loan servicer to determine your eligibility and understand the terms of deferment.

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Q: Student Loan Deferments Explained
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Only if it's part of the terms of your alternative student loan. Read the loan agreement or ask your lender. There is no law that requires the lender of a private/alternative student loan to offer you that option, and alternative student loans in general have none or very limited deferments other then in-school.


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from various lending institutions. ^While true, avoid getting private student loans when possible as you aren't entitled to certain rights such as forbearance and deferments, These lenders also have interest rates that vary month to month depending on market conditions. If possible, always get Federal student loans.


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