Put Off Your Payments With Student Loan Deferment
Everyone has run into some form of economic hardship in their lives. Whether it is due to the loss of a job, an unexpected expense or an unexpected family tragedy, financial trouble can cast a serious shadow over all aspects of your life. Not to mention, it can cause a lot of stress, especially when it comes to, what are often hefty, student loan bills.
A lot of the time, people become so overwhelmed with their debts and expenses, that they simply cannot afford to pay certain bills. Student loans are often the first to go, because you can’t ignore your electricity bill or your groceries, right? No one should have to prioritize their bills like this, but life happens and sometimes people see no other way of coping with the situation. However, there are ways to keep paying all of your bills so you won’t have to suffer the consequences of late payments or for letting you loans go into default.
One such method is called student loan deferment.
What is Student Loan Deferment?
A student loan deferment is when your lender sets up an agreement with you so that you can postpone repaying any of the principal for a designated amount of time. Now, that is not to say you won’t be responsible for the interest, because you most assuredly will. However, you can also defer paying the interest by capitalizing it. This means that the amount of interest you owe is added to your total loan amount and that any interest that accrues during deferment will be based on your principal and the capitalized interest. Make sense? You end up paying more money for the loan, but if it means not going into default, it may be worth it.
When Can I Get A Student Loan Deferment?
While you have to apply for student loan deferment, you can usually get one when you are experiencing financial hardship or issues. If you are currently unemployed, you may qualify for deferment as well. Disabled students may also qualify. Again, whether or not you will qualify will depend on your unique situation.
However, not only students that are struggling can get a deferment. Most students that receive a Federal Stafford or Perkins Loan experience the benefits of loan deferment, as they are not required to repay any money on the loan while they are in school and even up to several months after graduation. Sometimes, this deferment is also subsidized, meaning that no interest accrues on the principal while you are a student.
How Can I Apply For A Student Loan Deferment?
You can apply for a student loan deferment by contacting your lender directly. You will need to fill out an application, which will then be reviewed by your lender. Not all applicants qualify for a deferment. You really have to show need in order to be granted one. That is why when you submit your student loan deferment application you will be simultaneously required to submit information that clearly shows why you need this deferment. This may be current pay stubs or some other proof of financial hardship. It may also be proof that you are currently enrolled at least half-time in school.
Whatever you do, do not cease making payments on your student loan until you have received absolute notification that you’ve been granted a deferment. You don’t want to head toward a default only to find out your deferment request has been denied. That definitely does not look good!