We’ve talked about your repayment options and various types of deferment you can apply for if you just can’t make a payment. The next question people have is “What can I do if I don’t qualify for a Deferment and I can’t make payments?” The answer to that question is rather simple, you can put your loans into forbearance. The reason this should be your last option is because ALL of your loans, even your subsidized stafford loans, WILL ACCRUE interest. Obviously, there may be a time where you have to do this, that’s why this option exists. Below are the various forbearance options and a link to their individual forms.
Maximum Eligibility: 3 years, to be applied 12 months at a time
Who qualifies:
If your payments for you student loans are EQUAL or GREATER than 20% of your gross monthly income (that’s before taxes) or you have ZERO income.
With this forbearance you can do one of the following:
1) Temporarily stop making payments
2) Make smaller payments every month
You will have to provide documentation of income
Maximum Eligibility: 3 years, to be applied 6 months at a time.
Who Qualifies: This loan is discretionary, there are no qualifications. You just have to request that it be placed on your account.
*NOTE:* This may be a good option if you are already behind and are submitting paperwork to put your loans on deferment. Just make sure that the start date for both requests are the same so that the deferment will back date and the interest on your subsidized loans will not be capitalized.
INTERNSHIP-RESIDENCY FORBEARANCE
Maximum Eligibility: As long as you qualify, applied in 12 month increments.
You must be doing one of the following to qualify:
1) Completing a state certification program to practice in your chosen field
2) Completing a program to obtain a degree at a higher education institution, a health care facility, or a hospital.
Under this forbearance request you may choose to make smaller payments OR temporarily stop making payments.
TEACHER LOAN FORGIVENESS FORBEARANCE
Maximum Eligibility: 5 years, applied one year at a time
Combined Total of $17,500 in principal and interest on FFEL and/or Direct Loans
Who Qualifies: Teachers performing qualifying teaching service as a full-time teacher in an elementary or secondary school that provides services for low-income families as well as meet other qualifications. You that must have five consecutive years of service at this type of school (not necessarily the same school) to qualify for the forgiveness.
One of the following must be true:
1) You teach in an elementary school Full time as a highly qualified special education teacher for children with disabilities which you have special education training in. (Loan forgiveness up to $17,500)
2) You teach in a secondary school full time as a highly qualified special education teacher for children with disabilities which you have special education training in. (Loan forgiveness up to $17,500)
3) You teach full time in a secondary school as a mathematics teacher who is highly qualified (loan forgiveness up to $17,500)
4) You teach full time in a secondary school as a science teacher who is highly qualified (loan forgiveness up to $17,500).
5) You teach full time in a secondary school in one of the following (a) a highly qualified secondary school teacher, or (b) an area that corresponds with your academic major. (Loan forgiveness up to $5,000)
6) You teach full time in an elementary school and one of the following is true (a) you’re a highly qualified elementary school teacher or (b) you demonstrate teaching skiills and knowledge in mathematics, reading, writing, and other areas of the curriculum. (Loan forgiveness up to $5,000).
DEPARTMENT OF DEFENSE LOAN REPAYMENT PROGRAM FORBEARANCE
Applied 12 months at a time
For borrowers who are eligible to have part or all of their loans repaid by the Department of Defense.
As always you will need to contact your loan servicer to ensure you are qualified and/or apply any one of these forbearances to your loans. In the next segment we will discuss the cases in which student loans may be discharged.
Check out the other Student Loan articles in this series!
Repaying Student Loans: Intro (Where to Start)
Repaying Student Loans: Section 1 (When do I have to pay and how much?)
Repaying Student Loans: Section 2 (Your Repayment Options)
Repaying Student Loans: Section 3 (What if I can’t make my payment?)
Repaying Student Loans: Section 4 (What if I don’t qualify for deferment?)
Repaying Student Loans: Section 5 (Can my loan be discharged?)
Repaying Student Loans: Section 6 (Loan Forgiveness Programs)
Repaying Student Loans: Section 7 (Loan Consolidations)
Repaying Student Loans: Section 8 (Questions and Answers)
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