Quick Guide: Federal Loan Deferment and Forbearance

If you are in school or having trouble making payments on your federal loans, thankfully there are avenues you can take to temporarily suspend your payments.

Although loan deferments and forbearances have different meanings in the world of mortgages and more complicated financial instruments, in the world of student loans they basically mean that you can hold off on payments for a certain amount of time.

In order to qualify for a deferment, you need to meet one (or more) of these criteria:

Be a full-time paid volunteer in Action Programs for at least one year and must meet other conditionsBe on active duty in the Armed Forces in the United States and you must have agreed to serve for at least one yearReceive federal or state public assistance (WIC, Food Stamps, Welfare, etc.) or earn less than a federal minimum wage ($7.25/hr as of 2009) or exceed a federally defined debt-to-income ratioBe engaged in a full-time course of study in a Graduate Fellowship ProgramBe enrolled at an eligible school (accredited, Title-IV certified) on at least a half-time basisBe engaged in an Internship/Residency Program in an institute of higher education, hospital or health care facility and meet other specific criteriaBe serving on active duty in the U.S. Military during a war, other military operation or national emergency. Or you are performing qualifying National Guard duty during a war, other military operation or national emergencyBe on active duty in the National Oceanic & Atmospheric Administration (NOAA) and must meet other conditionsBe pregnant or caring for a newborn or newly adopted child; must not be working full-time or attending school; must have been enrolled in school at least half-time during the six months preceding the requested deferment period; and must meet other conditionsHave agreed to serve in the Peace Corps for at least one year and must meet other conditionsBe a parent whose dependent student, for whom your parent Direct PLUS Loan is made, must be enrolled at an eligible school on at least a half-time basis during the period of the deferment and your Direct PLUS Loan(s) must be disbursed on or after July 1, 2008Be serving full-time as an officer in the Commissioned Corps of the Public Health Service and meet other conditionsBe engaged in a full-time Rehabilitation Training Program and must meet other criteriaBe serving full-time in an organization that is tax exempt (non profit), have agreed to serve at least one year, earn less than minimum wage, and must meet other conditionsBe teaching full-time in a public or nonprofit private elementary or secondary school in a region, grade level, or discipline/subject matter defined as a shortage area by the U.S. Department of Education and other conditions must be metBe unable to work and earn money or go to school for at least 60 days in order to recover from an illness or injury or care for a spouse or dependent with an illness or injury. The condition cannot have existed before you applied for the loan(s)Be seeking but unable to find full-time employment (more than 30 hours per week) that is expected to last at least 3 months (unemployment)Be the mother of a preschool age child, be working full-time but earning not more than $1 above minimum wage, and meet other conditions

If you match up with any of these conditions, you likely are eligible for a federal loan deferment or forbearance. Head on over to the Student Loan Network’s financial aid forms page and download the appropriate one to get the process started.

Remember, you need to keep your loans current in order to defer them.. so no skipping any payments until the request is approved!

View the original article here