Debt, Education, Personal Finance 

Student Loan Deferment vs. Forbearance

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If you have a student loan and recently starting taking advantage of your employer’s education reimbursement program, you’ve probably heard the words deferment and forbearance thrown around quite frequently and you probably aren’t 100% sure what the difference is (unless you were a wordsmith/geek and knew what forbearance meant). Due to a mix up with Johns Hopkins, they reported me as less than part time and my deferment became a forbearance, which resulted in about $340 of interest that accrued during that period of forbearance (which led me to research the difference). While it’s not a thousands of dollars, I’m not paying $340 when I don’t have to (no one should).

Webster Dictionary Definitions:

  • Forbearance – a refraining from the enforcement of something (as a debt, right, or obligation) that is due
  • Deferment – the act of delaying or postponing

So, how does this affect you, a student loan holder? In both cases, you will no longer be required to make your regularly scheduled student payments. With a forbearance, the interest accrual process still continues, you simply aren’t required to make any additional payments. As interest accrues, you may decide to pay that off or not, that option is left up to you. Any unpaid interest that accrues and isn’t paid off within the period of forbearance is capitalized (made part of the principal). With a deferment, your loan is frozen in time – interest doesn’t accrue and you aren’t required to make any payments.

How do you get a deferment instead of a forbearance? Usually a student loan servicer will grant a deferment if you are enrolled in classes at least part-time, defined by the institution you’re currently attending. They do not have their own universal definition of part-time, they rely on the university or college to make that determination.

A forbearance is usually granted on request and with proof of some sort of reason. Your student loan servicer will have a forbearance process and you will simply have to follow that process, which will include an application.

{ 38 comments, please add your thoughts now! }

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38 Responses to “Student Loan Deferment vs. Forbearance”

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  2. Terry Piatt says:

    I’ve been toiling at or near minimum wage ever since leaving college and for some years was in deferment or forbearance. Eventually my lender said I had run into some sort of time limit and that it was time to pay up. The lender was unwilling to accept anything less than the full scheduled payment and I defaulted. A big pile of interest and fees was capitalized, sending my principal toward the moon. Today I am paying $100 per montgh but the loans are still in default and I’m paying a high interest rate I cannoty reduce and principal reduction is tediously slow. I will probably be broke for the rest of my life. Don’t let this happen to you.

    • Anonymous says:

      There might be an option for you to develop a financial plan and not be broke for the rest of your life. Maybe declaring a bankruptcy, or some other way. You should seek help of a certified financial planner (cfp). You can get a free initial consultation, and see if they could offer something interesting to you and actually help. You can find a cfp in your area through
      Good luck, I hope you won’t be broke for the rest of your life.

      • Annoyed says:

        My advise to all – if you have to get student loans college isn’t worth it – especially in this economy. Don’t do it! I have an MBA and am in debt from my student loans in the amount of $86K and no way to pay it back – I only have a year and a half left of my forebearance … after that they can drastically affect my credit negatively and call me with threatening messages – anything and more a normal creditor will do. I can pay what I can but it won’t be enough – they say with an MBA you will average 6 figures annually – this is a lie!!!!!! It isn’t worth it – don’t make the same mistake I made.

        • KC says:

          I have an MBA and yes I owe plenty in student loans after 2 degrees, I say I pay out about $700/month, however I made $60-70K my first year out of the MBA w/ the same job I had during the MBA, just worked more hours is all. I say now I make enough to pay, and since I have now been paying my loans about a year now, my credit score went up about 70 points already. I am pregnant also with my first, and I called today to see how it works if I do need to stop payments for a while, and its a forebearance, and they have other deferment options. I do not worry about them harrassing me for payment, and if it comes to where it gets that bad, I figure it will be another deferment I can somehow get. There are also several different repayment plans. I know one of my lenders just wants proof of the other loans and then they could spread the balance out over 20-30 years if you need. That means you pay more in the long run, but until things pick up, that could be an option for you; just ask.

      • Anonymous says:

        You can’t declare bankruptcy for student loans, the only way to get rid of them is to pay them off or die…sorry!

  3. Dee says:

    I accrued loans to get my Masters but my husband’s health keeps me from making enough to pay my student loans. I’ve deferred and now I have forebearance. Is there a way to pay minimal amounts to avoid default?

  4. saladdin says:

    Have you tired the student loan forum at creditboards? You will get more specific answers there probably.


  5. Anonymous says:

    I can not read anything under the head-Free Money Finance-it is all distorted! What is it?

  6. Anonymous says:

    Interest accrues on the unsubsidized portion of the loan in a deferment status, its not “frozen in time.”

    • Brian says:

      Right, I think the difference is only important for subsidized or maybe a few other loans. It doesn’t make a difference for the unsub, plus, etc.

      • Big Toe says:

        According to Jamie at Sallie Mae (5/31/12):

        Deferrment on a sub’d or unsub’d loan will not accrue interest

        Forbearance: unsub’d loan will accrue, but sub’d will not accrue

  7. Claudia says:

    I just applied for a Deferment and all they did was lower my payment 29 dollars. I am unemployed and have been and wanted to not pay and freeze it for a while until I got a job. What is the point of applying for a Deferment if they are not going to do it?

  8. Anonymous says:

    To everyone who has Stafford and/or Perkins Loans…you are eligible to consolidate ur loans with the Dept of Ed..even if u’ve consolidated already. 1.800.557.7392 is their #..Lowered my payment from $270 a month to $83 a month. Federal money cannot be discharged in bankruptcy and has no statute of limitations so if you have Federal Loans give the Dept of Ed a call and see if an income contingent repayment lowers your monthly bill…All I can say is that it did for me.

    • keke says:

      i actually called and my loans were in default for years and since i am currently displaced due to the economy i was granted a consolidation of my loans and i went from being garnished $700+ per month to settling for $320 a month and finally $45 a month after the consolidation. definitely give them a call because it is worth it

  9. kiki says:

    I am a debt collector of defaulted student loans. My best advice is to consolidate your loans with direct loans and get into the william d. ford income contingent repayment plan. It works for several of my borrowers and they don’t have high payments. Also the loan will be forgiven after 25 years of payments.

  10. Kat says:

    WOW 25 years! That is a very long time! I want to repay soon…I know it’s going to take me a min. but I am turning in my paperwork for a deferment now…Its in place for a year which is just enough time to finish the tuition remb. plan at my new job! I’m crossing my fingers and hoping it all falls into place right and it pays for some! I’ll take all and any help I can get!

  11. Key says:

    The military is going to start paying back my student loans. Should I consolidate all my loans before they begin making payments?? Please help!!

    • tina finney says:

      yes,,,hurry it is a process,,,,hurry but yes consolidate and u can go back to school plus they will take your taxes from you and your partners if you married and file jointly,,,,,but if u consolidate u are safe and they cannot take your taxes or deduct from your employer and u can go back to college and get more loans,grants,etc……hurry

      • Big Toe says:

        I hope this isn’t too late for you: it took 6 weeks for them to consolidate for me, then all my payments in the meantime went to the wrong account number (the “original” ones that are now “closed”). instead of them applying payments to the right/new account as credit, they are refusing (policy for everyone) and only issue refunds [which is a check that will arrive in 6 weeks to 6 months]. you must pay in the meantime while waiitng for your refund or else interest, penalties, judgements, wage garnishments, and ultimately, the death of you… the military will take even longer to receive the refund then reapply them to the loan. hope you didn’t get a nightmare!

  12. Margaret says:

    Does it matter what kind of school one is going to, to qualify for deferment. I am currently attending a private nursing school as a full-student and I am wondering if I qualify for deferment.

    • tina finney says:

      yes,,,u can,,,,,,

      • Big Toe says:

        WRONG: it is based on YOUR situation. the organization that gave you the loan is the one who decides this, not your school. the gov’t will give you a deferment if, for example, you lose your job, not based on whether your college is public or private.

  13. Anonymous says:

    i have loans from school and are not able to afford the payment options that are available for my situation, circumstances and is very overwhelming how am i suppose to continue my education or what would be the best option for me to do to take to keep my payments from getting to high for me to pay them off while getting back in school even if i decide to put them on hold until after i graduate or does interest still accure if u put it in deferment until u graduate

  14. debra says:

    ok i dont understand how can u have a subsized and an unsubsized loan

    • Big Toe says:

      Sub: based on financial need, interest will NOT accrue will it is put off

      unSub: not based on financial need (low income), interest accrues while in forbearance

  15. debra says:

    i have loans from schoola and are not able to afford the payment options that are available for my situation, circumstances and is very overwhelming how am i suppose to continue my education or what would be the best option for me to do to take to keep my payments from getting to high for me to pay them off while getting back in school even if i decide to put them on hold until after i graduate when i get back in school or does interest still accure if u put it in deferment until u graduate

  16. Terry says:

    I have to say is this.. Going to school can be costly especially how things are these days. They say oh, the economy is getting better and better, well, that’s a lie in my opinion. People who go to college earning a education trying to better themselves and yet still can’t get a job they deserve. Owing student loans is outrageous. Don’t be fooled by those reps of what school you go to telling you how the job market is for what degree you are going for. Don’t get sucked in with outrageous loans either if you absolutely need to. Would be nice if the president signs a bill helping out those unfortunate high student loans where if they can’t pay they can declare a full right off. That will never happen. You cannot declare bankruptcy trying to rid of the loans. Until a bill is passed not in my life time. The only thing to do is declare economic hardship where your loans are frozen and you don’t have to worry about paying it back for a while. Still sucks though. Still owe and still broke trying to pay it off. Is going to college worth all this? I tend to wonder..

  17. John Boscoe says:

    I have an MBA but do not have a very good income with my present job. Can one consolidate and do a deferment at the same time?

  18. John Boscoe says:

    I have an MBA but do not have a very good income with my present job. Can one consolidate and do a deferment at the same time?

  19. Ranbir says:

    hello, I am currently a medical student at St James school of medicine in the Caribbean. Before this school, I attended American University of the Caribbean but was dismissed due to personal issues. I had federal loans from Sallie Mae and since I am passed the 6 month grace period, they want me to start paying my monthly payments. However, I am still a full time student at St James School of Medicine. I tried a deferment with sallie mae but it was not accepted because my current school does not have a federal 6 digit pin. Are there any other options that I have to defer my payments until i graduate? Thank you

  20. f'd in the a says:

    When I applied for college the school was quick to get me in and pressure me to enroll. They told me what my payments would be, how long it would take to repay them and I didn’t think it would be very difficult. However they told me nothing about the interest rates, they said I wouldn’t have to make payments until 6 months after my schooling ended. They also didn’t tell me about the difference between the subsidized and unsubsidized loans and how interest was being tacked onto my bill from the time I started school with the unsubsidized loans. After the grants I received I only had $10,995 for my total loans, but with the interest it had gone up nearly $2000. I’m fortunate that I don’t owe as much as some other people do, and my monthly payment is reasonable but with all the other bills I have to pay and hardships of the economy and other things happening in my life I now have to look into getting a forbearance or possibly deferment. I feel like the school left a lot of important information out when they were trying to get me enrolled and it cost me a few thousand dollars, but with interest rates it ends up being far more. Make sure you realize what you’re getting into before you sign the paperwork, they may tell you its only 126 payments of whatever but they dont always figure in interest rates over that time or any other fees, penalties, or when you start incurring interest.

  21. needtoknow says:

    I had to leave my university for personal reasons it’s been about a year and a half. I was approved for a forebearance on my student loan. It did not go into default. My question is….can I return to school and still be eligible to receive finanancial aid,etc.

    • Anonymous says:

      You must be in current repayment status or a forebearance like you said and then once you get enrolled back into school then you will be eligible for a in-school deferment.

  22. ronald rayas says:

    im starting to believe theres hope for some one like my self can still go to school and be all i can be thank you for your time.

  23. Yup says:

    That is completey incorrect with deferments. Under a deferment, interest is still accruing on the subsidized and unsubsidized loans. The government will pay the interest on the subsidized loans while under a deferment but you are responsible for the interest on the unsubsidized portion of your loans and that interest will be capitilized on at the end of the deferment period if that interest isn’t paid off before that period ends.

  24. martha says:

    I will be applying with an UCCE program (University Consortium for Catholic Education) after graduation, June 2014. I am promised a Masters in Education when I commit to a 2yr program in which my tuition, housing, sometimes books are paid by the school, and that I am “considered full-time graduate student, added to the lender clearinghouse for loan deferral.” Where is the fine print? How can I find out about interest? Above comments mention that it is not with school that I must research. THANKS!

  25. martha says:

    Financial stuff is so bleak. I left the rat race to continue an education where I can attain fulfillment and work at something rewarding– not to make a lot of money.

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