Deferring Federal Loan Payments

Deferments

Deferments are periods of time in which borrowers are not required to make payment on their loans, though interest continues to accrue on any unsubsidized Stafford, Grad PLUS and/or private loans borrowed.

In-School Deferments

Students attending the HKS are eligible to defer federal loans while in attendance on at least a half-time basis. This applies both to loans taken out at the Kennedy as well as other federal loans borrowed for attendance at undergraduate or other graduate programs.

HKS participates in the National Student Loan Clearinghouse. The Office of the Registrar uploads enrollment information to this database three times during each semester.

Students may also request the Office of the Registrar to complete a paper deferment form for prior loans, by obtaining the deferment form from the lender and providing it to the Office of the Registrar for certification.  Deferment forms cannot be completed until after the first day of classes for the semester.

Post-Enrollment Deferments

After a student is no longer enrolled on at least a half-time basis, repayment typically begins within six months of the last day of classes. This six month period is called a grace period for Stafford loans and a post-enrollment deferment for Grad PLUS loans. Please note, however, that a grace period is a one-time event. If a student has previously exhausted the grace period, they may not be eligible for additional one. In such cases repayment begins within 30 days of the date which the student ceases attendance. Please Note: Grad PLUS loans borrowed prior to July 1, 2008 are not eligible for a grace period.  For borrowers of Grad PLUS loans, students can request a forbearance to align the repayment of your Grad PLUS with other loans but it must be requested  - it does not occur automatically.

If after ceasing enrollment a borrower has difficulty meeting his or her repayment obligations, the borrower may take advantage of post-enrollment deferment options. These options are only available for Federal loans (Stafford, Perkins, Grad PLUS).  Borrowers of private loans such as the Harvard HELP/CitiAssist/MEFA loan should contact their lenders to discuss options in case of repayment difficulty.

Unemployment Deferment

Students who are unemployed but seeking gainful employment may request deferral of their loans for a cumulative period not to exceed three years. Unemployment deferments are typically granted in six month increments with a new request required every six months.

Economic Hardship Deferment

Students who are employed but struggling to make payment may be eligible to defer loans based on economic hardship. Eligibility is based on a calculation that compares the amount of outstanding debt and required monthly loan payment with the borrower's earnings. For more information on the precise eligibility calculation, please contact the Department of Education at 1-800-848-0979.

For more information about deferments, please go to the US Department of Education.

Forbearance

If students do not qualify for a deferment - but have a temporary difficulty in making repayment - they may wish to apply for a forbearance. A forbearance is similar to a deferment in that the student may reduce or stop making payment on their loans for a cumulative period not to exceed three years. However, unlike a deferment interest will accrue on the entirety of the borrowed amount and not just on the the unsubsidized portion.