Student Loans, Deferment, and Payments

Did you take out a lot of student loans to pay for college, and now that you have graduated they need to be repaid? Many college graduates feel the financial strain of their student loan repayment after they graduate. There is a six month grace period between when students graduate and when their loans go into repayment. The problem is that some graduates do not find good jobs within those six months and can't afford the student loan payments every month.

There are a few things that can help graduates alleviate some of their student loan payment problems. First consider a forbearance or deferment. If a graduate's student loans are already in repayment, but they have not been making the payments this can have a negative impact on their credit score and history. A deferment allows the back payments owed to be brought up to date without paying anything. Basically the student's loans will be brought current and their credit report will be corrected once they are approved for a deferment. The deferment will fix the back owed payments and the credit report and score as long as the graduate can prove financial hardship or some other reason for having not been able to make their payments. It is important to apply for a deferment as soon as possible after you have missed payments. If you wait too long your loans will go into default and you will not be able to take a deferment and bring the back payments up to date.

Once a deferment is claimed and the payments are again current the graduate can then request a forbearance in order to postpone future payments for up to three years. Remember that people only get three years each for the total lifetime of their loans. So if only one year is needed don't use all three. The other years may be needed in the future in case another financial hardship occurs.