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What is a deferment?

If you qualify for a deferment, you have a right to have it set up on your student loans. Deferment is a postponement of repayment under various, specific circumstances such as:

being at least a half time student;
receiving public assistance, such as food stamps or cash welfare;
being unemployed and actively seeking full-time work;
receiving social security benefits.

For Federal Perkins Loans and subsidized Stafford Loans, you don't have to pay principal or interest during deferment.

For unsubsidized Stafford Loans and PLUS Loans, you can postpone paying principal, but you (or your parents, for PLUS Loans) are responsible for paying the interest. You can pay the interest during the deferment period or the loan holder can capitalize the interest when the deferment ends. Remember that capitalization will increase the loan balance.

The deferments listed apply to all Federal Perkins Loan borrowers and FFEL borrowers who received their first loan on or after July 1, 1993. Other deferments might also be available if you have an outstanding balance on a federal student loan made before July 1, 1993. For more information, Stafford Loan borrowers should contact their lenders or the Financial Aid Office at MHCC at 503-491-6963.