Deferments and Forbearance Options
If you have trouble making your education loan payments,
immediately contact the organization that services your loan. You
might qualify for a deferment, forbearance, or other form of
payment relief. It's important to take action before you are
charged late fees. For Direct Loans, contact your loan servicer. If
you do not know who your servicer is, you can look it up in the
U.S. Department of Education's National Student Loan Data System
SM ( NSLDS SM ).
Important: Review comprehensive information on deferment or forbearance
If you are unable to repay a loan that is part of the federal
education loan program, there are deferment options for which you
may be eligible. A deferment allows you to postpone your scheduled
If the loan is a subsidized Direct loan, the federal government
may pay the interest during periods of deferment. If the loan is an
unsubsidized Direct loan, you can pay the interest or it will be
capitalized back (added on) to the principal of the loan. You
should notify your lender immediately if you think you will have
difficulty repaying your student loan or making on-time
If you are willing but unable to make payments on your Direct
student loan(s), and you do not qualify for a deferment, you can
request forbearance. Forbearance is a temporary release from making
loan payments, an extension of time for making payments or a
temporary reduction in payment amounts.
One big difference between deferments and forbearance is that
you are responsible for paying any interest that accrues on all
types of loans during the forbearance period. You may pay the
accruing interest, or add it to the loan principal (this is called
"capitalizing") and pay it later when the forbearance ends.
However, remember that capitalization means you will be paying
interest on interest - the total cost of your loan repayment will
be considerably higher.