A student loan forbearance is an option that can help you get some relief from your monthly student loan payments if you experience financial difficulties. Understanding the difference between student loan forbearance and other options like deferment and income-driven repayment is important. Scroll down to take a closer look at what student loan forbearance is, how it works, and when it may be right for you.
What is student loan forbearance?
Lantern by SoFi experts explains, “The word “forbearance” is a legal term — it means to refrain from exercising a legal right, such as enforcing the payment of a debt.” Student loans are a fact of life for many people, but they can be especially painful when you’re already struggling financially. Student loan forbearance extension is an option that allows you to temporarily suspend payments on your student loan debt if you have financial hardship. While it’s not a permanent solution, it can help give you breathing room while you get back on track financially or while waiting for a deferment or forbearance period to end.
Determining if a student loan forbearance is right for you.
You should consider forbearance if:
- You are experiencing financial hardship.
- You aren’t able to make your payments and need more time to do so.
There are better options for some, though. For example, if you have other options like deferment or consolidation, they may be better options for your situation than forbearance—and they’re better than defaulting on your student loans!
How to apply for a student loan forbearance?
To apply for a student loan forbearance, you’ll need to:
- Fill out the online application. You can find this form on your lender’s website or by calling them directly. Make sure to check the box labeled “forbearance” and provide all of the information requested.
- Make sure your eligibility is confirmed before submitting the form. If you don’t think that you’re eligible, don’t submit it!
Once your application has been submitted, several weeks will be spent waiting for an answer. When they’ve received your request and processed it, they’ll let you know whether or not your request was approved by sending a letter with their decision inside—and if it was denied, they’d tell you why so that there are no surprises later on down the road when payment deadlines come up again!
Understanding the advantages and disadvantages of student loan forbearance.
Student loan forbearance is a good option if you can’t afford your payments. It allows you to postpone payments for up to 12 months and is an alternative to defaulting on your loans.
Forbearance has some drawbacks, though. If you have a subsidized student loan, forbearance may mean the government is no longer paying some of your interest. And when the time ends, you’ll have to pay more than before because more interest has accrued during that period. So the amount varies depending on how long you had your loan in forbearance and what kind of loans they are (private vs. federal).
Consider applying for forbearance if you struggle to make your student loan payments. This tool can help you avoid defaulting on your loans and keep your credit score intact while you get back on track with payments. Remember that forbearance is not a permanent solution, so be sure to do some research before deciding whether this option is right for you!