A forbearance is a temporary postponement of monthly loan payments for a specific reason and for a specified length of time. During a forbearance, interest is charged but monthly payments are not necessary. You may qualify for a forbearance if you are unemployed or experiencing an economic hardship. These postponement options have a limited amount of months for each forbearance type. A discretionary forbearance allows for other situations. Contact your loan servicer for your available forbearance options.
Note that the term deferment is often used interchangeably with forbearance. Deferment is more commonly used with federal student loans, since interest is not charged on subsidized loans during a deferment, whereas interest is never deferred on a PLUS loan.
In-school deferment: Beginning with PLUS loans borrowed on or after July 1, 2008, parents may request an in-school deferment on their PLUS loans while the student is enrolled in school and for the six month grace period after the student leaves school or enrolls for less than half time. This option allows a parent to borrow funds without the immediate obligation of making monthly payments while the student is enrolled. Interest continues to accrue on your PLUS loan during a deferment. Contact your PLUS loan servicer about this deferment option.
In-school forbearance: For PLUS loans borrowed prior to July 1, 2008, you are still able to request a payment postponement, but you will need to use the economic hardship forbearance during the in-school period. Some lenders have a designated forbearance for an in-school period postponement.
If you have a PLUS consolidation loan and want to postpone payments while the student is enrolled, you are able to use the economic hardship forbearance option. Contact your PLUS Consolidation Loan servicer for more information. If you want to postpone payments on PLUS loans you borrowed after July 1, 2008, DO NOT consolidate these loans. With the deferment of payments and because the interest rate is fixed there is no reason to consolidate before you enter repayment, and you will save your economic hardship forbearance options for future situations.
Remember that you can always pay any amount towards the PLUS loan during a forbearance, thus reducing the amount of interest paid and the length of the loan. Any amount received will first be applied onto the accumulated interest before being applied to the principal.