Yes, you can.  Many people down here in the Gloucester County, New Jersey area have experienced job loss and are surviving on unemployment.  Thus being able to get into a deferment for this reason can be very beneficial.

Apply for It Right Away!

However, if losing your job causes you to stop making your loan payments because you can no longer afford them, you need to get into the deferment as soon as possible.

The reason for this is that, unlike an economic hardship deferment, which is retroactive to the date the hardship began, an unemployment deferment can only go back six months.  Why is this important?

Well, suppose you stopped making your payments 250 days ago because you lost your job, and you are almost in default (270 days).  If you apply for the unemployment deferment, it will not bring you current!

How Do I Qualify?

How do you qualify for an unemployment deferment?  Well, there are two ways:

  • Be registered with a public or private employment agency located within 50 miles of your home (and be seeking work)
  • Provide proof of eligibility for unemployment benefits

How Long Does It Last?

The deferment, once you get it, is good for a maximum period of time:

  • 2 years if there is a loan balance prior to July 1, 1993
  • 3 years if all your loans originated after July 1, 1993

Should you find yourself out of a job, the first thing you need to ask yourself is whether this situation creates an economic hardship.  If it does, get that deferment to keep from going into default, and then look to see if an income based repayment plan can help.

So What Do I Do?

If you live in New Jersey and are struggling with payment on federal student loan debt because you became unemployed, I may be able to be of assistance. Just download this questionnaire, fill it out, and then fax it to me at 856-686-9911 or e-mail it to me. I will then review it to determine if I can be of assistance and contact you to discuss representation.

If you would like more information about student loans, you can dowload my free book, I Graduated; Now What? A Guide to Dealing with Your Student Loans.

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Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.