If you’re having trouble making payments temporarily, a postponement option may be a good fit for you. The two methods of postponment are through deferments or forbearances. You can see if you qualify for a deferment or forbearance by taking the eligibility quiz in your online account.
What is deferment?
Deferment is a period of time in which your payments are temporarily postponed. You have to meet specific criteria to qualify for deferment. To be eligible for a deferment your loans must be in repayment and you must provide specific documentation.
Does interest accrue during a deferment?
During a deferment, any accrued interest on subsidized loans will be paid by the U.S. Department of Education; however, you remaine responsible for any accrued interest on your unsubsidized or PLUS loans. If you do not pay the interest during the deferment period, it will be capitalized (added to your principal balance) at the end of the deferment period. You can use this calculator to see what the cost of a deferment might be.
What is forbearance?
Forbearance is another tool you can use when you have trouble making payments. If you are willing but financially unable to make your scheduled payments and do not qualify for a deferment, CornerStone may allow you to temporarily reduce the payment amount or temporarily postpone your payments. During forbearance you are responsible for the interest that accrues on both subsidized and unsubsidized loans. There is no fee to receive forbearance.
Does interest accrue during a forbearance?
During a forbearance, you remain responsible for any accrued interest. If you do not pay the interest during the forbearance period, it will be capitalized (added to your principal balance) at the end of the deferment period. You can use this calculator to see what the cost of a forbearance might be.