Decoding Student Loan Deferment

Student Loan Deferment Options: A Guide to Temporarily Pausing Your Payments

Student loan deferment options can vary based on the type of loan you have and when you received it. Federal student loans come with their own set of deferment rules, and private loans may offer different options altogether. The good news is that if you’re struggling to make payments, there are options that may help you avoid defaulting. Below, we’ll explore the different types of deferment and how they apply to your situation (as long as you’re not in default on your loans).

Types of Student Loan Deferment Options

Here’s a breakdown of the most common deferment options you may be eligible for:

• You’re enrolled at least half-time in school
• You’re unemployed and seeking employment
• You’re facing economic hardship
• You’re called to active military duty (military deferment)
• You’re serving in certain volunteer programs or law enforcement roles (for older Perkins Loans only)

Unemployment Loan Deferment

In today’s economy, finding work can be tough, especially for recent college grads. If you’re unemployed and struggling to make ends meet, you might qualify for Unemployment Loan Deferment. To qualify, you must provide proof that you are eligible for unemployment benefits and/or demonstrate that you are actively searching for full-time employment.

For payoff strategies and ways to manage balances over time, take a look at our comprehensive section on Student Loan Debt.

If you meet the eligibility criteria, you could have your student loan payments paused. However, it’s important to remember that just being unemployed won’t automatically qualify you—you’ll need to show that you’re genuinely seeking work and making an effort to find full-time employment.

CollegeWhale Tip: Keep detailed records of every job application, interview, and recruiter message—documentation strengthens your deferment request.

Economic Hardship Loan Deferment

If you’re going through a tough time financially, the Economic Hardship Loan Deferment might be an option for you. This deferment is granted on an annual basis and can last for a maximum of three years. To qualify, you typically need to meet one of the following conditions:

• You previously qualified for economic hardship deferment under another federal loan program.
• You are receiving federal or state public assistance benefits.
• You are serving as a Peace Corps volunteer.

If you’re approved, your payments will be paused, giving you some breathing room. However, interest may still accrue on most loan types, and unpaid interest may be added to your loan balance when the deferment ends.

CollegeWhale Tip: Deferment can help short-term—BUT check whether an income-driven repayment plan might save you more over the long run.

Military Service Loan Deferment

If you’re a member of the military, you may qualify for Military Service Loan Deferment. This option applies to active duty service members and can extend to National Guard members and military reserves called to active duty during a war, national emergency, or military operation. Unlike some other deferments, this one does not have a set time limit.

Military deferment is available under Direct Loans, older FFEL loans, and older Perkins Loans.

CollegeWhale Tip: While applying for military deferment, check your eligibility for interest rate caps and military-specific forgiveness options.

Volunteer Service or Full-Time Law Enforcement Service (Perkins Loans Only)

For borrowers who still have older Perkins Loans, deferment may be available if you’re engaged in approved volunteer service or working full-time in law enforcement. Rules vary depending on the qualifying program or role. Note that no new Perkins Loans have been issued since 2017, but existing borrowers may still access these deferments.

CollegeWhale Tip: Always confirm your volunteer or service program qualifies before relying on it for deferment—eligibility rules can be strict.

Important Considerations When Opting for Deferment

Before you apply for deferment, there are some key things you need to consider. First, check whether interest will be capitalized during the deferment period. This means that any unpaid interest could be added to your principal balance, increasing the total amount you owe in the long run.

Also, keep in mind that deferment is a temporary tool, not a long-term solution. It’s meant to give you breathing room but should ideally be paired with exploring alternative repayment options.

CollegeWhale Tip: If possible, pay even a small amount during deferment—reducing interest now lowers your future loan costs.

How to Apply for Deferment

To apply for deferment, you’ll need to contact your student loan servicer directly. You’ll be required to provide documentation proving your eligibility, such as unemployment records, hardship evidence, or military orders. Your loan servicer will guide you through the required forms and next steps. Stay proactive—processing times vary. Follow up if needed, and keep copies of everything.

Understand Your Options and Make Informed Decisions

Deferment can be a helpful tool in managing your student loans, but it’s important to fully understand the terms and conditions before opting in. Whether you’re unemployed, experiencing financial hardship, serving in the military, or doing eligible volunteer work, there are deferment options available.

Use deferment wisely, and take the time to explore income-driven repayment plans or forgiveness programs that may be better for your financial future.