Top Facts About Forbearance With Student Loans

Forbearance with student loans can provide temporary relief when the financial situation is tight. You can use forbearance for student loans to temporarily pause your loan payments.

Again this can be a good fix for the time being but it is not a long-term solution.

In this article, I will explain everything that you need to know about forbearance with student loans, how to apply for it, who is eligible for student loans forbearance and what are some alternatives to forbearance for student loans.

Let’s dive in…

What is Forbearance With Student Loans?

It is a facility given to students who are not in a good financial situation, with student loans forbearance you can temporarily stop your loan repayments or you can also reduce the repayment amount.

This relief is only for a limited period of time and after that relief period, you will have to make the payments again. This will not lead you to a student loan forgiveness and you will also not make any progress towards repayment of your loan.

Forbearance with student loans can only help you for a limited period of time, so if you think you will be regaining your financial stability, there is no harm in applying for student loan forbearance.

How Does Forbearance With Student Loans Help You?

Forbearance with student loans will postpone your loan repayments. Suppose there had been an accident and you were required to cover some medical expenses. This situation led you into a tight budget and you can not afford to make your student loan repayment.

In this case, forbearance for student loans can help you postpone your loan payments for up to 12 months or less. It gives you some time to get back on your feet.

You can also renew the forbearance time at the end of the first relief. Another benefit of forbearance with student loans is that it helps you avoid the student loan default, however, you might end up paying a higher amount if you allow the interest to be capitalized.

How does Forbearance For Student Loans Work?

Your loan repayment time might be delayed as a result of forbearance but your interest continues to accrue during the deferral period. You have the choice to either keep paying the interest or allow it to accrue and be capitalized.

The capitalized interest will be added to your loan at the end of your forbearance period. keep in mind that if you allow the interest to be capitalized you might end up paying a higher amount than the original loan.

The only exception to this is the Perkins Loan, the interest accrued on a Perkins Loan is not capitalized, however, the federal government has stopped issuing the Perkins loans.

You can get forbearance with student loans for up to 12 months from the government, and you can also apply for an extension at the end of the forbearance period, the extension is given for up to 3 years. Private loan lenders don’t usually give an extension and the loan forbearance period is 12 months.

Forbearance With Student Loans

How to Apply For The Student Loans Forbearance?

If you are in a bad financial situation and you are unable to pay your student loans, it’s time that you should look into forbearance with student loans. It is not an automatic process, and you will have to inform the lender about your poor financial situation to secure a forbearance for student loans.

Applying for forbearance usually requires submitting an online application, you will have to submit a request to your loan servicer for the loan forbearance, sometimes you are also required to submit additional documents as proof that you are eligible for student loan forbearance.

Types Of Student Loans Forbearance

There are two main categories of forbearance with student loans:

1- General Student Loan Forbearance

2- Mandatory Student Loan Forbearance

Both of these types have different eligibility criteria, your loan provider will decide whether or not you qualify for forbearance with student loans. You will have to submit your request along with the reason for which you are unable to pay the loan back.

Following are the eligibility criteria for both forbearances

Eligibility For General Loan Forbearance

General forbearance can be requested by those students who are unable to pay their Direct, FFEL, or Perkins Loan. If you qualify you will be granted forbearance of up to 12 months.

You can get forbearance for student loans for the following reasons

  • Financial crisis
  • Medical expenses
  • Change in employment
  • Other valid reasons

The first forbearance period can also be extended if your financial situation doesn’t improve at the end of the 12-month forbearance period. You can apply for an extension of up to 3 years. The extension is usually not given by the private lenders.

You can apply for general forbearance for student loans if you are unable to make your monthly scheduled loan payment due to a bad financial situation by simply filling out an online form or calling your loan provider.

Eligibility For Mandatory Loan Forbearance

Just as the name indicates, this forbearance is mandatory if you are eligible, you will be granted forbearance for student loans if you fulfill the following criteria

  • If you are participating in a medical or dental internship or residency (Direct and FFEL loans only)
  • Total student loan payments of 20% or more of your monthly gross income (Direct, FFEL, and Perkins loans)
  • If you are serving in AmeriCorps (Direct and FFEL loans only)
  • If you are qualified for a Teacher Loan Forgiveness (Direct and FFEL loans only)
  • Qualification for partial repayment of your student loans under the U.S. Department of Defense Student Loan Repayment Program (Direct and FFEL loans only)
  • Activated service in the National Guard when it doesn’t provide for a military deferment (Direct and FFEL loans only)

Forbearance With Student Loans

General Questions About Forbearance


What is the length of student loan forbearance?

Forbearance with the student loan is usually up to 12 months, You will be given a temporary pause on your due student loan by your lender if you can’t afford to repay your loan.

However, you can also get an extension of up to 3 years on a federal student loan forbearance. Private student loans don’t usually extend the forbearance period.

What qualification is required to apply for forbearance for a student loan?

There is no specific or mandatory qualification that you need to apply for general loan forbearance. All you have to submit an online form and give a valid reason for which you are unable to make your scheduled monthly loan payment.

Forbearance with student loans procedure?

There are two ways to apply for the student loan forbearance, you can fill out the online form provided by your loan servicer or you can simply make a phone call to your lender and ask for a forbearance.

Sometimes you are required to provide additional supporting documents to get forbearance with student loans.

What is interest accrual on student loan forbearance?

Interest is accrued on all loans other than the Perkins Loan. If you do not pay the interest it will be accrued to be capitalized and added to your loan principal balance.

Forbearance with student loans availability?

If you are eligible for a mandatory student loan forbearance, it will be available to you at all costs, your loan servicer is bound to give your this forbearance. As far as the general loan forbearance is concerned, it depends on your loan provider whether he thinks you are eligible or not.

Does forbearance with student loans have a credit impact?

No, there is no impact on your credit score for taking a student loan forbearance.

Forbearance With Student Loans

Forbearance Vs Deferment

Let’s have a glance at deferment. It is also a temporary fix for your student loans, but it is preferred over forbearance, why? because forbearance with student loans always increases the total amount of the loan that you owe, but deferment is interest-free on certain types of federal loans.

To apply for a deferment you must fulfill the following criteria

  1. You should attend school at least half time
  2. You should be unemployed
  3. Receiving federal Aid
  4. Your monthly income is less than 150% of states poverty guidelines
  5. Active military employee
  6. If you are undergoing cancer treatment

Advantages and Disadvantages of Forbearance With Student Loans

Student loan forbearance can help you in times of need but just like any other financial tool, it also has some disadvantages. Although deferment is better than student loan forbearance, but forbearance is still a better option than taking a personal or payday loan.

Let’s discuss some advantages and disadvantages of forbearance

Advantages of Forbearance

  1. It is a better option than garnishment, personal loan, or default
  2. Gives a delay which can help you improve your financial situation
  3. No specific qualifying criteria
  4. Lower interest than a personal loan or payday loan
  5. Easy to apply for
  6. Gives you the freedom to pay for the critical expenses
  7. Doesn’t affect your credit score
  8. You can apply for an extension of up to 3 years

Disadvantages of forbearance with student loans

  1. It is just a temporary fix
  2. You end up paying a higher amount than you actually owe
  3. Capitalization of accrued interest
  4. Repeated renewal may result in loan default
  5. Late/missing payments may hurt your credit score
  6. Private lenders might not give an extension

With the pros and cons listed above, it is clear that forbearance with student loans is only good if you are using it as a temporary solution. It is not a long-term fix as repeated renewals can lead you to a loan default.

Forbearance is noted on your credit report but it does not lower your credit score as long as you don’t miss a payment or you don’t repay late.

What are Alternatives to Student Loan Forbearance?

Forbearance with student loans should be your last choice, if you want to postpone your student loan payments you should first look into the following options

1- Deferment

Deferment will help you delay your scheduled loan payments just as forbearance, however, if you have a subsidized student loan the government will be paying your interest during the deferment period.

At the end of the deferment period, you will only have to pay the original loan amount. Deferment can also be taken for up to 3 years. If you don’t have a subsidized student loan then deferment and forbearance are the same things.

Unsubsidized student loans and private student loans deferment are treated the same way as forbearance with student loans. In this case, you should look for IDR or Income-Driven Repayment plans.

2- Income-Driven Repayment Plans

There are four types of IDR for the student loans:

  1. Revised Pay As You Earn Repayment Plan (REPAYE)
  2. Pay As You Earn Repayment Plan (PAYE)
  3. Income-Based Repayment Plan (IBR)
  4. Income-Contingent Repayment Plan (ICR)

You will have to pay a percentage of your income, there is one downside to this type of repayment, as it takes longer to pay back in IDR, and you might end up paying much higher interest.

There is also an advantage to IDR, if you are unable to pay all of the loan amounts within 20-25 years, the remaining loan amount will be forgiven. Unlike forbearance with student loans, this will also improve your credit score.


Let’s conclude our discussion, forbearance with student loans is just a temporary fix and it should never be your first choice. It may give you freedom for the time being but it is not a long-term financial solution.

Instead of forbearance you should look into the alternatives and apply for deferral or IDR if possible. If you have applied for a forbearance try to keep paying the interest and not let it capitalize, also never miss a payment, and avoid late payments at all costs.

I hope this article was helpful, if you have any questions, leave them in the comment section.