Expert Debt Management
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Am I Eligible for Forbearance?
You may have never heard of the term forbearance before, but this is a process in which many people are able to find the debt relief that they need. Forbearance is generally only considered for those who are unable to make their loan payments and do not qualify for deferment. During a period of forbearance you will often not need to make any payments on your loan, or the loan payments will be significantly lowered. Even if you are granted forbearance you should keep in mind that you will still have to pay interest, which is different than many deferred loans. If you don't pay this interest it can be tacked onto your principal, causing you to become even more indebted.
If you believe that you are eligible for forbearance you need to formally apply for it with your lender. You will need to contact the lender to determine what their process is for approving forbearance. You will likely need to fill out forms and provide proof of income, but you should not assume that you will be approved and stop making payments. Instead, you need to continue to make payments until you have heard back from your lender.
You may be eligible for forbearance if:
You are not able to make your payments due to health problems
You are serving in a medical or dentistry internship or residency
If you are serving in a position that is listed under the National Community Service Trust Act
If your monthly payments are equal to or more than 20% of your income
This by no means an exhaustive list of all of the things that may qualify you for forbearance. You should also know that a lender does not need to approve you for forbearance, so you should not assume that it will be granted. If you are having a problem making your payments you should simply get in contact with your lender. Even if they are unwilling to grant you forbearance they will likely be willing to work with you so that you can continue making payments that fit within your budget.
Disclaimer: This site is not , nor should it be taken to be, legal, financial or other professional advice. It merely provides a generalized guidance and generalized information only. Consult a financial advisor or an attorney to discuss any legal or financial issues involved with credit and debt decisions.
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