What is student loan forbearance?
More on Student Loan Forbearance
If a person has a federal student loan and is having difficulties making payments due to financial difficulty, he or she may be eligible for forbearance. There are two types to of forbearance to understand.
- Discretionary: Whether or not forbearance is applied to student loans is at the discretion of the lender.
- Mandatory: Forbearance must be applied to student loans by the lender because the applicant meets certain criteria.
Requesting a Discretionary Forbearance
There are a few reasons why a discretionary forbearance may be requested:
- During times of application processing for loan consolidation or cancellation
- Financial hardship
- Prior to filing for bankruptcy
- Personal challenges
Requesting Mandatory Forbearance
There are a few situations why a mandatory forbearance may be requested:
- Internships and residency program: The applicant is a dental or medical student participating in an internship or residency.
- National Guard member: The applicant is not yet eligible for military deferment, but has been activated by a governor.
- Monthly gross income: The applicant’s combined amount due for all student loans, is 20% or greater than 20% of the applicant’s overall monthly gross income.
- U.S. Department of Defense Student Loan Repayment Program: The applicant qualifies for a partial repayment.
- National Service: The applicant is serving in one of the country’s national service programs.
- Teaching: The applicant is teaching at a Title 1 school that meets the requirements for teacher loan forgiveness.
Student Loan Forbearance and Private Loans
There are no situations or reasons where a private student loan lender is required to provide an applicant with a forbearance. However, this does not mean that they will not grant a student loan forbearance.
If a student carries private student loans, and feels that what he or she is experiencing in life would benefit from a forbearance from private student loan, that student should call and discuss it with his or her lender.