Student Loan Deferment & Forbearance Calculator
- August 14, 2018
- Posted by: Dave Rathmanner
- Category: Student Loans
If you are struggling with your loan payments, you might be tempted to call your lender and request a forbearance or deferment. However, you should enter these programs with some caution; often, they do not solve the problem and can make it worse.
This student loan deferment and forbearance calculator will help you determine how large your new loan balance will be after you leave deferment, your new monthly payment, and the interest that accrued during deferment.
What is the Difference Between a Forbearance and Deferment?
Under a deferment, your loan payments are pushed back and, on subsidized loans, no interest accrues. You are eligible for a deferment if:
- You are enrolled in a qualifying graduate program
- You are disabled and enrolled in a job skills training program
- You are unemployed and unable to find a full-time job
- You have an economic hardship, such as an unexpected medical issue
- You are on active duty in the military
With forbearance, your loan payments are postponed, but interest continues to build. You can qualify for a forbearance if:
- Your monthly payment is 20 percent or more of your gross monthly income
- You are serving in a national service program, like AmeriCorps or Peace Corps
- You are experiencing financial hardship or illness. Under these circumstances, it is up to the lender to decide if you qualify; you are not guaranteed acceptance.
Deferment is a better option than forbearance for federal student loan borrowers with subsidized loans because the interest does not accrue. With forbearance, as interest builds, you’ll end up paying significantly more over the length of your repayment. This is something you can see with the student loan deferment calculator below.
Deferment and forbearance are offered for federal student loans, but some private student loan lenders may not offer them. Additionally, you are only eligible for these federal options before you default on your loans. Further, if you opt to defer your loans, you do not qualify for public service loan forgiveness programs until you make 120 consecutive payments—if you take time off from payments, that count starts over again once you start repaying.
Both deferment and forbearance programs can give you a break from payments for as long as three years, but it can be an expensive way to handle your debt and can set you back from building a secure financial future. Use the student loan deferment calculator to determine how much interest will build up if you defer or enter forbearance with your loans.
You can see all of our student loan calculators here.
Author: Dave Rathmanner
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