Student loan deferment lets you temporarily pause your federal student loan payments for a set period, usually up to three years. During deferment, interest may not accrue on subsidized loans, but it will on unsubsidized loans. You must apply through your loan servicer and meet specific eligibility requirements.
How Student Loan Deferment Works
Deferment is a temporary pause on your monthly loan payments. It is not the same as loan forgiveness—you still owe the money, but you get a break from paying for a while. The U.S. Department of Education offers deferment for certain situations, such as returning to school, unemployment, or economic hardship.
During deferment, you do not have to make payments. However, interest may continue to grow on your loan, depending on the type. For subsidized federal loans, the government pays the interest during deferment. For unsubsidized loans, you are responsible for the interest, and it may be added to your loan balance (capitalized) if you do not pay it.
Who Qualifies for Deferment?
You may qualify for deferment if you are enrolled at least half-time in an eligible college or career school. You can also qualify during a period of unemployment or if you are experiencing economic hardship, such as receiving public assistance or working in a low-income job. Other situations include military service, cancer treatment, or a post-active-duty student deferment.
Each type of deferment has specific rules and time limits. For example, the unemployment deferment usually lasts up to three years, and the economic hardship deferment also has a three-year maximum. You must reapply for deferment when the period ends.
How to Apply for Student Loan Deferment
To apply, you must contact your loan servicer—the company that handles your billing and payments. You can find your servicer by logging into your Federal Student Aid account at StudentAid.gov. You will need to submit a deferment request form, which is available online or from your servicer.
The form asks for your personal information, loan details, and the reason for the deferment. You may need to provide supporting documents, such as proof of enrollment, unemployment records, or income information. Submit the completed form to your servicer as soon as possible.
Your servicer will review your application and notify you of the decision. If approved, the deferment will be applied retroactively to the date you requested, but you must continue making payments until you receive approval. If you miss a payment while waiting, it could be reported as late to credit bureaus.
Steps to Apply: A Quick Checklist
- Log in to StudentAid.gov to find your loan servicer.
- Download the correct deferment request form for your situation.
- Fill out the form completely and attach any required documents.
- Submit the form to your servicer by mail, fax, or online upload.
- Keep a copy of your application and note the submission date.
- Follow up with your servicer if you do not hear back within a few weeks.
Deferment vs. Forbearance: Key Differences
Deferment and forbearance both pause payments, but they work differently. Deferment is often better because interest may not accrue on subsidized loans. Forbearance, on the other hand, always accrues interest on all loans, and you may have to pay fees to apply for forbearance in some cases.
Deferment is usually available for specific situations like school enrollment or unemployment. Forbearance is more flexible and can be used for financial hardship that does not fit deferment criteria. However, forbearance can be granted for up to 12 months at a time, and you can request it multiple times.
| Feature | Deferment | Forbearance |
|---|---|---|
| Interest on subsidized loans | May be paid by the government | Always accrues |
| Interest on unsubsidized loans | Accrues | Always accrues |
| Typical maximum duration | 3 years (varies by type) | 12 months at a time |
| Application required | Yes, with specific forms | Yes, but often simpler |
| Best for | School, unemployment, hardship | Short-term financial issues |
Important Things to Know Before You Apply
Deferment can affect your loan balance if interest capitalizes. Capitalization means unpaid interest is added to your principal, so you will pay interest on that interest later. To avoid this, consider paying the interest as it accrues during deferment.
Deferment does not count toward loan forgiveness programs, such as Public Service Loan Forgiveness (PSLF). Only payments made under certain repayment plans count toward forgiveness. If your goal is forgiveness, deferment may not be the best option.
Always apply for deferment before you stop making payments. If you miss payments without approval, you risk default, which can hurt your credit and lead to wage garnishment. Your servicer can provide information about your specific loan terms and deferment options.
Actionable Tips for a Smooth Application
Start the process early—at least a month before you need the pause. Gather all required documents, such as proof of enrollment or unemployment, to avoid delays. Keep a record of all communications with your servicer, including dates and names of representatives.
If your deferment request is denied, ask for the reason and appeal if you believe the decision is wrong. You can also request forbearance as a temporary solution while you reapply or explore other options. Stay in touch with your servicer to avoid any lapse in coverage.
Consider whether income-driven repayment (IDR) plans might be a better fit. IDR plans can lower your monthly payment to as little as $0, and they count toward forgiveness after 20 or 25 years. Compare the pros and cons before choosing deferment.
Final Summary
Student loan deferment is a valuable tool to pause payments during times of need, but it is not automatic—you must apply and qualify. Understand the interest implications, know your servicer’s rules, and submit your paperwork early. If deferment is not right for you, explore forbearance or income-driven repayment to keep your loans in good standing.
Frequently Asked Questions
What is student loan deferment and how does it work?
Student loan deferment lets you temporarily stop making payments on your federal student loans for a set period, usually up to three years, and interest may not accrue on subsidized loans.
How do I apply for student loan deferment?
To apply, contact your loan servicer, fill out the appropriate deferment request form, and submit it with any required documents like proof of enrollment or unemployment.
Can I get student loan deferment if I am unemployed?
Yes, you can qualify for an unemployment deferment if you are actively seeking full-time employment and meet the requirements, which typically lasts up to three years.
Does student loan deferment affect my credit score?
Deferment itself does not hurt your credit score, but it is important to get approved before stopping payments to avoid late payment reports.
What is the difference between deferment and forbearance?
Deferment is often better because interest may not accrue on subsidized loans, while forbearance always accrues interest on all loans.
