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Retroactive Forbearance: How It Works

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When the average student loan borrower loses a job, faces a medical emergency or suffers another sort of hardship, they’re understandably more likely to focus on picking up the pieces of their life before considering student loan repayment strategies.

That’s where retroactive forbearance or deferment comes in. It allows you to backdate a pause on your monthly payments. It’s an important benefit to be aware of, as you might be dealing with tragedy or another serious scenario for weeks or months before you get around to phoning your loan servicer or lender.

Fortunately, retroactive forbearance and deferment are available for federal student loans, though they might not be possible for privately-held education debt.

What’s the fine print of retroactive forbearance for federal loans?

Yes, you could receive retroactive forbearance or deferment for federal student loans, from the original date you became eligible. The only catch is that a repayment respite can’t begin more than six months before you filed your application with your loan servicer. (With that said, some federal loan borrowers have reported gaining approval for retroactive relief more than six months in the past.)

Say that you were laid off from work in January. You’d have until the end of June to submit an Unemployment Deferment Request or a general forbearance application. Forms would ask you for the date you became unemployed or when you’d like your retroactive forbearance or deferment to take effect.

(In the case of the student loan interest freeze enacted widely during the coronavirus pandemic, administrative forbearances were awarded automatically, with no application required. That forbearance was to expire Jan. 1, 2023.)

Keep in mind that it’s best to continue making on-time and full payments until you hear back from your federal loan servicer. Otherwise, your debt would become delinquent if your retroactive forbearance or deferment application doesn’t pass muster.

What about retroactive relief for private student loans?

Repayment protections like these vary from lender to lender among banks, credit unions and online companies. Although your lender might not grant forbearance retroactively, reach out as soon as possible to review your options. You could be eligible to apply for modified loan terms and avoid student loan delinquency if you act quickly.


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