A very common question I get about federal student loans is the difference between a deferment and a forbearance. In simplest terms, a deferment is an entitlement.  It must be granted if you qualify.  On the other hand, most forbearances are granted at a lender’s discretion.

A deferment is the more formal process, as a deferment is applied for in writing, often with supporting documentation. A forbearance is less formal, as most requests can be made verbally over the phone (although those based on income do require documentary proof). 

During deferment, the federal government pays interest that accrues on a subsidized loan.  But you are responsible for interest that accrues during a forbearance, and during a deferment on an unsubsidized loan.

The important thing to bear in mind with deferments and forbearances is that they are temporary fixes, not solutions.  If you cannot afford your student loan payment, then these are not going to help you in the long term.  This is because:

  • They last for a limited amount of time (depending on the type)
  • There may be a limited amount of times a particular one can be granted
  • Many of them have a certain amount of lender discretion

They have their uses, but getting into some sort of repayment plan is really the best way to go.

If you live in New Jersey and are struggling with payment on federal student loan debt, 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.

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