Student Loan Deferment: Can You Defer Student Loans?

Student loan deferment allows eligible borrowers to stop or reduce payments on their federal student loans for up to three years. Deferment of private student loans varies by lender, and not all lenders offer it.

If borrowers are struggling with payments, deferment might give them the chance to get back on their feet financially and avoid defaulting on their student loans. Student loan default can have a number of negative consequences.

Read on to learn more about deferred student loans, including how student loan deferment works, the pros and cons, plus some alternative ways to get student debt relief.

What Is Student Loan Deferment?

Student loan deferment allows eligible federal student loan borrowers to reduce or stop making payments on their loans for up to three years. If you have a subsidized federal loan, no interest accrues during the deferment period. If you have an unsubsidized federal loan, interest will accrue and be added to the loan amount (or capitalized) at the end of the deferment period.

Deferments are available on federal loans including Direct Loans, Federal Stafford Loans, and Perkins Loans. (Unpaid interest is not capitalized on Perkins loans.)

Private student loans may or may not offer deferment options to borrowers. If you have questions about your private student loan, you can check with your lender directly.

How Does Student Loan Deferment Work?

If you have federal student loans and are no longer in school at least half-time, you will need to apply to pause student loan payments through deferment. This usually involves submitting a request to your student loan servicer. You will also typically need to provide documentation to show that you meet the eligibility requirements for the deferment (more on eligibility requirements below).

If you have an unsubsidized federal student loan and you’re granted deferment, interest will continue to accrue during the deferral period. You will have the option to either pay the interest as it accrues or allow it to accrue and be capitalized (added to your loan principal balance) at the end of the deferment period.

If a private lender offers deferment, they will likely have their own requirements and terms.

Why Defer Student Loans

Applying for deferment may make sense if you are facing short-term difficulty paying your student loans. A deferment might provide you with the opportunity you need to stay afloat until you can get back on firmer financial ground. If you have a subsidized federal loan, the interest won’t accrue during deferment.

Why Not Defer Student Loans

If you’re able to keep on top of your loan payments, deferment likely doesn’t make sense. And if you think that you might have long-term difficulty making your monthly loan payments, deferment of student loans may not be the best option, either.

Here’s why: If you have an unsubsidized federal loan, interest will continue to accrue during deferment. At the end of the deferment period, this interest will be capitalized on the existing loan amount (or the principal loan value). Moving forward, interest will be calculated based on this new total. So essentially, you are accruing interest on top of interest, which can significantly increase the amount of interest owed over the life of the loan.

Pros and Cons of Student Loan Deferment

Deferment of student loans may help borrowers who are struggling financially, but it might not be the right choice for everyone. Here are some pros and cons to consider when evaluating deferment options for federal student loans.

Pros	Cons
Those who have had student loans deferred are able to temporarily suspend or lower the monthly payments on their student loans.	On most federal student loans, interest continues to accrue during deferment. This may significantly increase the total cost of borrowing over the life of the loan.
Borrowers may qualify for deferment for periods of up to three years.	Because interest may continue to accrue during deferment, other options — like income-driven repayment plans — may be more cost-effective in the long term.
Deferment may keep student loans out of default.	Borrowers likely won’t make progress toward repaying their loan while in deferment.

Types of Student Loan Deferment

For federal student loans, there are a few different deferment options. Here are the details on some of the most common reasons borrowers apply for deferment.

In-School Deferment

Students who are enrolled at least half-time in an eligible college or career program may qualify for an in-school deferment. If you are enrolled in a qualifying program at an eligible school, this type of deferment is generally automatic. If you find the automatic in-school deferment doesn’t kick in when you are enrolled at least half-time in an eligible school, you can file an in-school deferment request form.

Unemployment Deferment

Those currently receiving unemployment benefits, or who are actively seeking and unable to find full-time work, may be able to qualify for unemployment deferment. Eligible borrowers can receive this deferment for up to three years.

However, under the One Big Beautiful Bill Act, loans made after July 1, 2027 will no longer be eligible for deferments based on unemployment hardship.

Economic Hardship Deferment

This type of deferment may be an option for current borrowers who are receiving means-tested benefits like welfare, who work full-time but earn less than 150% of the poverty guidelines for their state of residence and family size, or who are serving in the Peace Corps. Economic hardship deferments may be awarded for a period of up to three years.

Under the One Big, Beautiful Bill Act, loans made after July 1, 2027 will no longer be eligible for deferments based on economic hardship.

Military Deferment

Members of the U.S. military who are serving active duty may qualify for a military service deferment. After a period of active duty service, there is a grace period in which borrowers may also qualify for federal student loan deferment.

Recommended: Guide to Military Student Loan Forgiveness

Cancer Treatment Deferment

Individuals who are undergoing treatment for cancer may qualify for deferment. There is also a grace period of six months following the end of treatment.

Other Types of Deferment

There are other situations and circumstances in which borrowers might be able to apply for deferment. Some of these include starting a graduate fellowship program, entering a rehabilitation program, or being a parent borrower with a Parent PLUS Loan whose child is enrolled in school at least half-time.

Consequences of Defaulting on Federal Student Loans

If you stop making payments on your student loans you risk defaulting on your loans. Default timelines vary for different types of student loans.

Most federal student loans enter default when payments are roughly nine months, or 270 days, past due. Federal Perkins Loans can default immediately if you don’t make any scheduled payment by its due date.

Potential consequences of defaulting on federal student loans include:

•   Immediately owing the entire balance of the loan

•   Losing eligibility for forbearance, deferment, or federal repayment plans

•   Losing eligibility for federal student aid

•   Damage to your credit score, inhibiting your ability to qualify for a car or home loan or credit cards in the future

•   Withholding of federal benefits and tax refunds

•   Garnishing of wages

•   The loan holder may take you to court.

•   Inability to sell or purchase assets such as real estate

•   Your school may withhold your academic transcript until your loans are repaid.

Consequences of Defaulting on Private Student Loans

The consequences for defaulting on private student loans vary by lender but could include repercussions similar to federal student loans and more, including:

•   Seeking repayment from the cosigner of the loan (if there is a cosigner)

•   Calls, letters, and notifications from debt collectors

•   Additional collection charges on the balance of the loan

•   Legal action from the lender, such as suing the borrower or their cosigner

To avoid these negative consequences, it’s best to contact your lender as soon as you think you may miss a payment. Your lender may be more willing to work with you prior to your loan entering default.

Who Is Eligible for Student Loan Deferment?

To be granted a deferment on federal loans, borrowers need to meet certain criteria.

Currently, you may be eligible if you’re:

•   Enrolled at least part-time in college, graduate school, or a professional school

•   Unable to find a full-time job or are experiencing economic hardship

•   On active military duty serving in relation to war, military operation, or response to a national emergency

•   In the 13-month period following active duty

•   Enrolled in the Peace Corps

•   Taking part in a graduate fellowship program

•   Experiencing a medical hardship

•   Enrolled in an approved rehabilitation program for the disabled

Borrowers who re-enroll in college or career school part-time may find that their federal student loans automatically go into in-school deferment with a notification from their student loan provider.

Loans may also keep accruing interest during deferment — depending on what types of federal student loans the borrower holds. Borrowers are still responsible for paying interest if they have a:

•   Direct Unsubsidized Loan

•   Direct PLUS Loan

•   Unsubsidized Stafford Loan

If you don’t pay the interest during the deferment period, the accrued amount is added to your loan principal, which increases what you owe overall.

What if You Have Private Student Loans?

Private lenders aren’t required to offer deferment options, but some do. For example, some private lenders might allow you to temporarily stop making payments if you:

•   Lose your job

•   Experience financial hardship

•   Go back to school

•   Have been accepted into an internship, clerkship, fellowship, or residency program

•   Face high medical expenses

Typically, even while a private student loan is in deferment, the balance will still accrue interest. This means that in the long term, the borrower will pay a larger balance overall, even after deferment.

In most cases, even with accrual of interest, deferment is preferable to defaulting. Borrowers with private loans could contact the lender to ask what options are available.

The Limits of Student Loan Deferment

Keep in mind that deferment is not a long-term solution. By definition, it’s temporary. Federal student loan borrowers will ultimately need to go back to making payments once they are no longer deferment-eligible. For example, a borrower’s deferral might end if they leave school, even if their ability to pay has not improved.

Federal loans can be deferred for up to three years. With private loans, there may not be an option to defer at all, and if it is an option, the limit may be no more than a year.

Other Options for Reducing Federal Student Loan Payments

Besides student loan deferment, there are other choices if you can’t afford the cost of your monthly payments. Here’s a look at some alternatives to deferment.

Income-Driven Repayments

For a longer-term solution, you may want to consider an income-driven repayment plan.

If you qualify, you may be able to reduce your monthly payment based on your income and family size. On the Income-Based Repayment (IBR) plan, student loan balances may be forgiven after 20 or 25 years, depending on when the loan was disbursed.

For student loans borrowed on or after July 1, 2026, there is only one income-driven repayment plan available called the Repayment Assistance Plan (RAP). With RAP, payments range from 1% to 10% of adjusted gross income with terms of up to 30 years. After the term is up, any remaining debt may be forgiven. If your loans were borrowed before July 1, 2026, you can choose between RAP and IBR, which bases your student loan payment on 10% to 15% of your discretionary income.

Forbearance

Student loan forbearance is another way to suspend or lower your student loan payments temporarily during times of financial stress. Generally, forbearance is not as desirable as deferment, since you will be responsible for accrued interest when the forbearance period is over no matter what type of federal loan you have.

When comparing deferment vs. forbearance, you’ll want to keep in mind that there are two types of forbearance for federal student loan holders: general and mandatory.

General student loan forbearance is sometimes called discretionary forbearance. That means the servicer decides whether or not to grant your request. People can apply for general forbearance if they’re experiencing:

•   Financial problems

•   Medical expenses

•   Employment changes

General forbearance is only available for certain student loan programs, and is granted for up to 12 months at a time. At that point, you are able to reapply for forbearance if you’re still experiencing difficulty (there is a cumulative limit of up to three years). However, for loans borrowed on or after July 1, 2027, general forbearance may only be granted for up to nine months in any 24-month period.

General forbearance is available for:

•   Direct Loans

•   Federal Family Education Loan (FFEL) Program loans

•   Perkins Loans

Mandatory forbearance means your servicer is required to grant it under certain circumstances. Reasons for mandatory forbearance include:

•   Serving in a medical residency or dental internship

•   The total you owe each month on your student loan is 20% or more of your gross income

•   Working for AmeriCorps

•   You’re a teacher that qualifies for teacher student loan forgiveness

•   You’re a National Guard member but don’t qualify for deferment

Mandatory forbearance is granted for up to 12 months at a time for loans borrowed before July 1, 2027. For loans borrowed after July 1, 2027, mandatory forbearance is capped at nine months in any 24-month period.

Another Option to Consider: Refinancing

Depending on your personal financial circumstances, another long-term solution you may choose to explore is student loan refinancing. With refinancing, you replace your existing loans with a new loan from a private lender. Qualifying borrowers may be able to secure a lower interest rate or the option to lengthen their loan’s term and reduce monthly payments. However, while lengthening the repayment period may lower monthly payments, it will generally result in paying more interest over the life of the loan.

Just be aware that refinancing federal student loans with a private lender means you no longer have access to federal protections and programs like deferment and income-driven repayment.

The Takeaway

If you have federal student loans and need to temporarily pause or reduce your payments, you may be able to qualify for deferment. Alternatives to deferment include forbearance, income-driven repayment, and refinancing. Each option has its pros and cons. Private student loans don’t come with government-sponsored protections like deferment. However, some private lenders may offer hardship and deferment programs of their own.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

How long can student loans be deferred?

Depending on the type of deferment you are enrolled in, federal loans can be deferred for up to three years. Private student loans may not offer an option to defer payments, and if they do, the time limit will typically be set by the individual lender.

Why would you defer student loans?

Deferment may be helpful if you are facing a temporary financial hurdle because it allows you to pause or reduce loan payments for a period of time. Deferment may help keep borrowers from defaulting on student loans. If you have subsidized federal loans, interest will not accrue during deferment.

Are there any reasons not to defer student loans?

One potential reason not to defer student loans is if a borrower has unsubsidized federal loans. With these loans, interest will continue to accrue during deferment. At the end of the deferment period, the accrued interest is capitalized, which can significantly increase the amount of interest owed over the life of the loan. Also, because a borrower typically doesn’t make progress repaying their loans while they’re in deferment, they could end up paying off their loans over a longer period of time.

Can you defer private student loans?

Possibly. Some private lenders offer deferment, but it varies, based on the lender. You can contact your lender directly to find out if they offer deferment.

Does deferment of student loans affect your credit score?

Generally speaking, deferment of student loans does not directly impact your credit as long as your account remains in good standing. Deferment is preferable to defaulting on your student loans, which could potentially negatively impact your credit among other consequences.

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