Postponing repayment on federal student loans is possible through a number of deferment and forbearance options. These programs are available if you meet certain conditions. Most federal loans also have grace periods so that you don’t have to start repayment right away.
Both deferment and forbearances options allow you to postpone payments usually for a year, sometimes longer. The advantage to deferments is that interest does not accrue on subsidized loans while you are in a qualified deferment period. You can get a deferment in most cases while you are still in school. Once you are out of school, you must meet the criteria for the limited number of deferments. These include deferments for unemployed borrowers and for certain borrowers facing economic hardship. Forbearances are more flexible, but be advised that interest will accrue during deferment periods on unsubsidized loans and during forbearance periods. If you can afford it, you should consider making interest-only payments during periods of forbearance or deferments on unsubsidized loans. This does not reduce the principal balance, but it does prevent the balance from growing during the postponement period.
Postponing repayment may be a helpful option, particularly if you don’t expect your financial distress to last long. You should be wary, however, if your servicer tells you that forbearances or deferments are your only options. You should consider the full range of other possibilities, including flexible repayment. It is a good idea to review these tips for dealing with your loan servicer.