How Long Can You Defer Parent PLUS Loans?

Deferment is a valuable option for those managing Parent PLUS loans, as it allows for temporary relief from making payments. Understanding how long you can defer these loans involves knowing the specific terms and conditions set by your loan servicer and the federal government. Here’s a comprehensive guide to help you navigate the deferment process, including eligibility criteria, the application process, and the implications for your loan balance.

Understanding Parent PLUS Loans

Parent PLUS loans are federal loans borrowed by parents to help pay for their child's education. Unlike other federal student loans, these loans are not based on financial need but are offered to parents with good credit histories.

Types of Deferment

1. In-School Deferment

   • Eligibility: You may qualify for in-school deferment if the student for whom you borrowed the loan is enrolled at least half-time in an eligible school.
   • Duration: This deferment lasts as long as the student remains enrolled at least half-time. The deferment can be renewed if the student continues to meet the enrollment requirements.

2. Economic Hardship Deferment

   • Eligibility: If you’re facing financial difficulties, you may be eligible for an economic hardship deferment. This includes situations where you receive public assistance or your income is below a certain level.
   • Duration: The maximum period for this deferment is typically up to 12 months. However, it can be renewed if you continue to meet the hardship criteria.

3. Unemployment Deferment

   • Eligibility: If you are unemployed and actively seeking employment, you may qualify for an unemployment deferment.
   • Duration: You can be granted an unemployment deferment for up to 12 months, with the possibility of renewal if you remain unemployed.

4. Military Service Deferment

   • Eligibility: If you or your spouse are in active military service, you may qualify for this deferment.
   • Duration: The deferment can last for the duration of your military service, including up to 13 months after returning from active duty.

Applying for Deferment

1. Contact Your Loan Servicer

   • Reach out to your loan servicer to discuss your deferment options. They can provide specific details and forms required for the application.

2. Complete the Application

   • Fill out the necessary forms, which can often be completed online or by mail. Provide documentation supporting your eligibility for the deferment.

3. Submit Documentation

   • Include any required documentation, such as proof of unemployment or military service. Ensure that all forms are completed accurately to avoid delays.

4. Await Confirmation

   • After submitting your application, your loan servicer will review it and send you confirmation of your deferment status. Keep track of your application status to ensure it is processed in a timely manner.

Implications of Deferment

1. Interest Accrual

   • During deferment, interest may continue to accrue on your Parent PLUS loans. It’s essential to understand how this will affect your total loan balance.

2. Loan Balance

   • The interest that accrues during deferment will be added to your loan principal, increasing the total amount you will repay over the life of the loan.

3. Repayment Schedule

   • Once the deferment period ends, your loan servicer will update your repayment schedule. Be prepared for adjustments to your monthly payment amount.

Conclusion

Deferment options for Parent PLUS loans provide temporary relief but come with implications for your loan balance and repayment schedule. Understanding the types of deferments available and the application process can help you manage your loans effectively. Always stay in touch with your loan servicer to ensure you are making the most informed decisions regarding your loan payments.