There are options available to borrowers to help you avoid having your loan go into a defaulted status. These options are deferment, forbearance and cancellation. There are forms that must be completed in order to receive these benefits.

FORBEARANCE

Forbearance is a temporary postponement of payments, an extension of time allowed for making payments, or making smaller monthly payments. Forbearance benefits are limited to up to a maximum of three (3) years or 36 months.

The borrower may qualify for forbearance of loan payments if the borrower’s total monthly payments on all Title IV loans equals or exceeds 20% of his or her gross monthly income. The borrower may also qualify due to poor health or other acceptable reasons or if the U.S. Department of Education authorizes a period of forbearance due to a national military mobilization or other national emergency.

Interest continues to accrue during the forbearance period and is payable either monthly or in a lump sum at the end of the forbearance period. A forbearance is granted in intervals of 6, 9 or 12-month increments.

A deferment extends the repayment period for a specified period of time because the borrower has fulfilled certain regulatory requirements. Payments are not required and interest usually does not accrue during periods of deferment.

The following deferments are currently in effect:

When a borrower is granted a deferment, the borrower will receive a six (6) month post-deferment grace period. Therefore, payments will not resume until six months after the expiration of the deferment period.