Am I Eligible for a Loan Deferment?
A deferment is a period of time during which no payments are required. You can not receive a deferment if you have loans that is already in default.
Circumstances in your life may make it difficult to make your loan payments on time. You may qualify for a deferment, allowing payments to halt for a small period of time or lower your loan payments. Contact your loan servicing organization to develop alternative repayment options.
During deferment you do not have to make any principal payments on your loan. However, if you have an unsubsidized Stafford Loan, you are always responsible for interest payment even during deferment.
The different 5 types of deferment:
In-school -- You may qualify if you are enrolled at least 6 credits in an eligible school. There is no time limit on this deferment.
Unemployment -- The deferment can last for up to three years. You must provide documentation to your lender that you are actively seeking employment.
Rehabilitation -- You may qualify if you are participating in a approved rehabilitation program. There is no time limit on this deferment.
Graduate Fellowship -- You may qualify if you are participating full time in a graduate fellowship program. There is no time limit on the deferment.
Economic Hardship -- You may qualify if you are constrained by severe financial circumstances. The deferment is limited to three years.
So, what happens when you don't make any loan payments?