If you can't make payments on one or more of your student loans, you may be able to get temporary or permanent relief from making payments.
Learn about your options before you go into default. If you default on your student loans, you will suffer negative consequences. For example:
If you are unable to make loan payments, some options include:
postponing payments through deferment or forbearance programs (see below)
eliminating the loan altogether through loan cancellation (see below)
discharging the loan in bankruptcy (to learn more, see Student Loan Debt in Bankrutpcy) , or
A deferment excuses you from making student loan payments for a set period of time because of a specific condition in your life -- such as returning to school, economic hardship, or unemployment. Interest will not accrue on subsidized loans during the deferment period.
Qualifying for deferment. You can defer repayment of a student loan if:
you meet specific criteria and conditions for your type of loan, and
you are not more than 270 days behind in loan payments (or six months behind for an unemployment deferment on a FFEL).
Most common types of deferments. The most common deferments are:
How to get a deferment. Contact your servicer to get an application to apply for a deferment.
In a forbearance, your loan holder gives you permission to stop making payments for a set period of time or to temporarily reduce payments. Interest always continues to accrue during a forbearance. In some circumstances, a forbearance may be available even if you have defaulted.
Qualifying for a forbearance. Forbearance on federal loans may be granted for a number of reasons, including:
unforeseen personal problems
inability to pay within the maximum repayment term (usually 10 years), or
monthly payments totaling more than 20% of a borrower's monthly income.
How to get a forbearance. To apply for a forbearance, contact your loan servicer, explain your situation, ask for a forbearance, and fill out the appropriate forms. (Here's how to find the servicer of your student loan.)
In certain limited circumstances, you may be able to cancel your student loan -- meaning that you no longer have to pay it. Doing this is not easy; you'll have to meet specific conditions depending on the type of loan you have.
Often, when you cancel your loan, the government will also reimburse you for payments already made, and help clean up your credit record. In some situations, you won't be able to cancel the entire loan, but you may be able to get rid of a portion of the loan.
Loan cancellation (also called loan discharge) is available only in certain, specific situations, including: