|
|
Loan
Postponement Federal Student loans afford you the benefit of postponing your payments when financially necessary, while stile protecting your credit standing. There are two options available to you, Deferment and Forbearance. Your lender allows you a limited amount of each over the life of your loan. Use it wisely! The application forms for each of these can generally be found on your lenders website. Forbearance: Is a non-qualifying temporary postponement of payment where interest still accrues. Your lender will generally offer you the option of making interest only payments while in Forbearance, which will prevent the interest from capitalizing (being added on) to the end of your loan, thus increasing your overall loan amount. This is not mandatory, but is recommended if you can afford to do so. Most lenders will offer you Forbearance for 3 - 6 months at a time, some 6 - 12 months depending on your financial needs. Ask you lender for details. Deferment: Is also a temporary postponement of payment. The primary two differences between deferment and forbearance are: 1).
You have to qualify for deferment 2). The government will pay the interest that accrues on subsidized loans you have. There are different types of deferment in place to meet your needs. Some of those are listed below. Note*: As always, check with your lender. Unemployment Deferment: Deferment request for the qualified borrower who is unemployed but seeking work in any field. Economic Hardship Deferment: Deferment request for the qualified borrower who has been granted this deferment by the William D. Ford Direct Loan Program, who is receiving federal or state public assistance, who is serving as Peace Corp volunteer, or who meets specific low income qualifications. (Available to a borrower who has an outstanding balance and all loan(s) were made on or after July 1, 1993). Education Related Deferment: Deferment request for borrowers who are engaged in a Graduate Fellowship, Rehabilitation Training, or Internship/Residency Program, or are teaching in a designated Teacher Shortage Area. In-School Deferment: Deferment request for qualified borrowers who have returned to school on at least a half-time basis. Parental Leave/Working Mother Deferment: Deferment requests for mothers who have an outstanding balance on a loan made between July 1, 1987 and July 1, 1993 and who meets specific qualifications regarding pregnancy, child care, school enrollment, and unemployment. Public Service Deferment: Deferment request for the qualified borrower who is on active duty in the Armed Forces or National Oceanic and Atmospheric Administration, is an office of the Public Health Service, is serving in the Peace Corp, or is a paid volunteer in the Action Programs or for a Tax-Exempt Organization. Permanent and Total Disability Deferment: Loan discharge application for borrowers who are unable to repay their FFEL student loans due to total and permanent disability (as defined by the Department of Education). Temporary Total Disability Deferment: Deferment request for the qualified borrower who is or who spouse or dependent is temporarily disabled. (Available to a borrower who has an outstanding balance on a loan made prior to July 1, 1993 only).
|
|
Consumer
Collection Did you Know....That under the Federal Family Educational Loan program (FFEL) you are allowed to change your repayment plan up to once a year if your financial need dictates? This is especially helpful for those who want to reserve their Deferment or Forbearance or who have already used their allowed amount. Call your lender for details if you are having trouble making your payments. Note: Remember that any plan other than the standard plan can extend your term and increase your loan amount.
|
|
|
MSB© 2005 - 2008 All Rights Reserved |
|
