After several extensions, COVID-19 relief for federal student loans is scheduled to end in January. What does that mean for borrowers? If your loans were current when the special forbearance went into effect, you should plan to resume making payments. If your federal student loans were delinquent or in default at the time, collection efforts will start again.
What many borrowers don’t realize is that there are a total of seven types of student loan deferments available — separate from the COVID-19 forbearance — for those who are struggling to make student loan payments. Let’s look at student loan deferment to see what’s available.
What is a deferment?
Borrowers having trouble making federal student loan payments can apply for several types of deferments. If the lender grants the deferment, the borrower doesn’t have to make student loan payments for a set amount of time. During that time, there are no penalties for not making payments and the deferred loans are not in danger of becoming delinquent or going into default. Depending on the type(s) of loan(s) you have, you may still need to pay interest during the deferment period. This will be a much lighter financial burden than making your full student loan payment.
Types of Student Loan Deferment
Your unique circumstances will determine the type of deferment you should request. The seven types of deferments are:
If you’re experiencing unemployment or can’t find a full-time job, you can apply for an unemployment deferment. You may be able to extend this deferment for a total of three years.
- Economic Hardship Deferment
If you are experiencing financial challenges, other than unemployment, or are serving in the Peace Corps, this is the deferment to request.
- In-School Deferment Request
If you return to an eligible college or career school and enroll for at least half time, you may be eligible for a deferment.
- Graduate Fellowship Program
Apply for this type of deferment after you enroll in an approved graduate fellowship program.
- Parent PLUS Borrower Deferment
Parents who received a Direct PLUS Loan or a FFEL PLUS Loan may be eligible for deferment if the student for whom they obtained the loan is enrolled at least half time at an eligible college or career school (and for six months after they are no longer enrolled).
- Rehabilitation Training Program Deferment
If you are enrolled in an approved rehabilitation training program for the disabled, you may qualify for this type of deferment
- Military Service and Post-Active Duty Student Deferment
Apply for this type of deferment if your active duty military service involves a war, military operation or national emergency.
Student Loan Counseling Can Help
If you’re not sure which type of deferment you may qualify for or need assistance applying, we can help. Our certified student loan counselors understand all deferment options and can help you fill out your paperwork correctly to streamline the application process.
If you don’t qualify for a deferment, there may be other programs available. These include income-driven repayment plans, consolidation, or forbearance options that may offer payment relief.