Sometimes special circumstances arise that make it difficult for you to pay back your loans. Deferments and forbearance are two important tools that allow you to adjust or postpone your loan payments.

LOAN DEFERMENT for the Federal Family Education Loan Program (FFELP) and Perkins Loans

LOAN DEFERMENT
A deferment is a period of time during which a lender suspends regular loan payments on a federal student loan. Deferments are granted for specific situations and have certain time limitations and conditions for eligibility. In general, deferments are granted for:

• Enrollment in school at least part time.
  In-School Deferment Form
• Study in a graduate fellowship program.
  Education Related Deferment Form
• Unemployment (limited up to 36 months).
  Unemployment Deferment Form
• Economic hardship (limited up to 36 months).
  Economic Deferment Form or to see if you might qualify, try the Economic Hardship Calculator

In addition, deferments for the following circumstances are available:

• Military Deferment Request
• Parental Leave/Working Mother Deferment Request Form
• PLUS Borrower with Dependent Student Deferment Request Form
• Public Service Deferment Request Form
• Temporary Total Disability Deferment Request Form

If the deferred loan is a subsidized Federal Stafford Loan or a Federal Perkins Loan, the government will pay the interest on the loan during the deferment period. If the deferred loan is an unsubsidized Federal Stafford Loan, the borrower is responsible for paying the interest that accrues during the deferment period.

Borrowers should contact their loan holders to apply for a deferment. If a borrower does not know who their loan holder is they may visit the National Student Loan Data System or call the Michigan Guaranty Agency at 1-800-642-5626, extension 77009.

LOAN FORBEARANCE
Loan forbearance allows a borrower to temporarily lower or postpone their payments. A loan holder may grant forbearance if the borrower is willing, but temporarily unable to make full or partial payments and does not qualify for a deferment.

During forbearance, interest continues to accrue on all loan types, although the borrower may not be required to make interest payments. Any unpaid interest will accrue and be added onto the principal of the loan at the end of the forbearance period.

Forbearances are mostly granted at the discretion of the lender. Borrower should not cease making payments until they receive written notification that forbearance has been granted.

Borrowers should contact their loan holders to apply for forbearance. If a borrower does not know who their loan holder is they may visit the National Student Loan Data System or call the Michigan Guaranty Agency at 1-800-642-5626, extension 77009. Forbearance forms are also available on our website.