Unemployed And Can’t Pay Student Loans

Q: I am unemployed and can’t pay student loans back at this time. I need help figuring out how to suspend these student loan payments or avoid having to make these student loan payments while I am unemployed?

A: For those who are unemployed and can’t pay student loans back at this time, you do have some options, which will depend on the current status of your student loans and what type of student loans you have.

First, know that most federal and private student loans offer a six month grace period after graduation or the date you quit school. During the grace period, borrowers will not have to make any student loan payments, unless they choose to do so.

Second, with student loans that have entered into repayment (meaning you have already surpassed the grace period on the student loans), you most likely have a forbearance or deferment option on the loans. Both federal student loans and (most) private student loans offer what is known as forbearance or deferment. Though the exact terms/rules for deferment and forbearance can vary, essentially choosing to utilize the deferment or forbearance option on your student loans will suspend the student loan payments for up to six months (typically). Forbearance and/or deferment can help prevent your student loans from going into default while you are unemployed, however the interest on your student loans can capitalize during forbearance or deferment, depending on what type of student loans you have (for private student loans the interest will almost always capitalize).

Lastly, for those who are unemployed and have exhausted their grace period and forbearance and/or deferment, realistically, these borrowers have very few options. Borrowers who fall into this category can try to consolidate their student loans (federal and private student loans must be consolidated separately), to see if they could take advantage of the deferment option associated with the new consolidation loan, however be aware that when consolidating your student loans, you will likely pay more over the lifetime of the loan, and a consolidation loan for private student loans can be very difficult to secure. Beyond these options, borrowers will need to contact the loan lender(s) directly, and see what (if any) options they have for those who are unemployed and cant make their student loan payments.

College Financial Aid Answers.

CollegeWhale.com has been a trusted source for college financial aid information for nearly 2 decades! We have been on a mission to connect students (and parents) with free money for college and FAFSA facts, and we haven't stopped yet!

next fafsa article

next fafsa articleThe Difference Between Loan Default And Delinquency

When it comes to student loan debt, many questions automatically arise. Default…

next fafsa articleFiling Bankruptcy And Student Loans

The topic of bankruptcy and student loans can be difficult to generalize…

next fafsa articleBack Into Repayment After Student Loan Default

Q: If I have defaulted on my student loans, how do I…

next fafsa articleDo I Have To Payback My Student Loans If I Drop Out

Q: If I dropout of college before I graduate from my degree…

About CollegeWhale

Questions For CollegeWhale

Have a college financial aid question? CollegeWhale.com is full on answers! Type your question in the search box to get started.

Sign Up To Win Scholarships

Sign up for The CollegeWhale.com Weekly Scholarship Round-Up, and let us bring the scholarships to you! Get a list of new available college scholarships delivered to your inbox each week.

sign upsign up