Forbearance pauses your student loan payments, but interest keeps growing

Forbearance is an agreement with your loan servicer to stop making monthly payments for a set period — usually three to six months, though it can extend longer. During forbearance, you are not required to pay, and your loan does not go into default. The catch: interest continues to accrue on most loan types, meaning you owe more money when forbearance ends than you did when it started.

Forbearance is different from deferment, which also pauses payments but may stop interest from growing depending on your loan type and reason for requesting it. Forbearance is what you get when you do not meet the strict conditions for deferment, or when you have already used up your deferment time.

You request forbearance directly from your loan servicer — the company that collects your payments. The servicer decides whether to grant it based on your circumstances and the type of loan you hold. Federal loans and private loans have different forbearance rules.

Key Takeaways

  • Forbearance stops your monthly payment obligation for three to six months or longer, but interest accrues on most federal loans during this time.
  • You must request forbearance from your loan servicer; it does not happen automatically even if you stop paying.
  • Federal loans have two types of forbearance — discretionary and mandatory — with different reasons and time limits for each.
  • When forbearance ends, your payment resumes at the same amount unless you change your repayment plan, and any accrued interest may be capitalized (added to your principal balance).
  • Private student loans rarely offer forbearance; if they do, the terms depend entirely on the lender's policy.

Federal loan forbearance: discretionary versus mandatory

Federal student loans come with two categories of forbearance. Discretionary forbearance is what your servicer may grant if you are in financial hardship — job loss, medical emergency, or other temporary crisis. Your servicer has the power to say yes or no. There is no set time limit, but servicers typically grant it in increments of three to six months, and you can request renewal if the hardship continues.

Mandatory forbearance is what your servicer must grant if you meet specific conditions. These include: you work in a public service job and are pursuing Public Service Loan Forgiveness; you are a medical or dental resident; you serve in the military; or your monthly loan payment would exceed 20 percent of your gross monthly income. Mandatory forbearance periods are usually 12 months, and you can request renewal if the condition still applies.

Interest accrues during both types of federal forbearance on most loans. The exception is subsidized federal loans (like Direct Subsidized Loans), where the government pays the interest during forbearance — but only if you are in school at least half-time or in certain other protected statuses. Once you leave school or lose that status, interest accrues on subsidized loans too.

What happens to interest during forbearance

On unsubsidized federal loans and most private loans, interest does not stop accruing during forbearance. Each month, interest is calculated on your outstanding balance. At the end of forbearance, your servicer will capitalize the accrued interest — meaning they add it to your principal balance. Your loan is now larger than it was when forbearance started.

This matters because you then pay interest on the interest. If you owed $25,000 before forbearance and $1,500 in interest accrued during six months of forbearance, your new principal is $26,500. Future interest calculations are based on that higher number.

You can avoid capitalization by paying the accrued interest before forbearance ends, even if you cannot afford the full monthly payment. Some servicers allow you to pay just the interest and keep the principal payment paused. Ask your servicer whether this option exists for your loan.

How to request forbearance from your servicer

Contact your loan servicer directly — the company name appears on your loan statement or at studentaid.gov under "My Aid." You can request forbearance by phone, online portal, or mail. Have your loan account number ready.

For discretionary forbearance, be prepared to explain your hardship. You may need to provide documentation: a termination letter from your employer, a medical bill, a notice of eviction, or a letter from your employer confirming reduced hours. Different servicers ask for different proof, so ask what they need before you gather documents.

For mandatory forbearance, you will need to prove you meet the condition. Military service requires a copy of your orders or military ID. Public Service Loan Forgiveness requires employment certification. Income-based mandatory forbearance requires recent pay stubs or tax returns showing your income.

Your servicer will tell you the forbearance period length and the date your payment resumes. Get this in writing — either a confirmation email or a letter. Do not rely on a phone conversation alone.

What happens when forbearance ends

Your monthly payment resumes on the date your servicer specified. The payment amount stays the same unless you change your repayment plan. If you were on a standard 10-year plan before forbearance, you remain on that plan after forbearance ends — your loan term does not extend automatically.

Any interest that accrued during forbearance is capitalized and added to your balance. This increases your monthly payment if you are on an income-driven plan, because those plans calculate payment as a percentage of your income applied to your new (larger) balance.

If you cannot afford to resume payments when forbearance ends, you can request another forbearance period, switch to a different repayment plan, or explore deferment if you still meet the conditions. You cannot stay in forbearance indefinitely, but you can renew it if your circumstances have not changed.

Private student loans and forbearance

Private lenders are not required to offer forbearance. Some do; many do not. If your private lender does offer it, the terms are entirely up to them — there is no federal standard. Some private lenders offer forbearance only to borrowers in extreme hardship and require extensive documentation. Others offer it more readily but charge a fee or require you to pay accrued interest upfront.

Contact your private lender directly to ask whether forbearance is available and what conditions apply. If forbearance is not available, ask about a temporary payment reduction or a switch to interest-only payments. Some private lenders will negotiate short-term relief even if they do not call it forbearance.

Forbearance versus other payment relief options

Forbearance is one tool, but it is not always the best choice. If you have federal loans and your income has dropped, an income-driven repayment plan may lower your payment to $0 without pausing your loans or accruing interest. If you are in school, deferment may stop interest from accruing entirely. If you work in public service, Public Service Loan Forgiveness may eliminate your debt after 120 may have access to payments.

Before you request forbearance, ask your servicer what other options exist for your situation. Forbearance is useful for temporary hardship — a job loss you expect to recover from in a few months, a medical crisis, a brief income drop. It is less useful for long-term hardship, because the accruing interest makes your debt larger, not smaller.

Frequently Asked Questions

Does forbearance hurt my credit score?

Forbearance itself does not appear on your credit report as a negative mark. However, if you stop paying without requesting forbearance first, your loan goes into default and your credit score drops. Once you are in forbearance, your account status is reported as current, so your credit is protected.

Can I request forbearance more than once?

Yes. You can request forbearance multiple times, and servicers often renew it if your hardship continues. However, there are limits: discretionary forbearance cannot exceed three years total in your lifetime, and mandatory forbearance periods are usually 12 months and must be renewed annually if conditions still apply.

What if I make a payment during forbearance?

You can pay at any time during forbearance. Payments reduce your principal balance and reduce the amount of interest that accrues. If you can afford even a partial payment, making one during forbearance limits how much interest capitalizes when forbearance ends.

Does forbearance count toward Public Service Loan Forgiveness?

No. Months in forbearance do not count as may have access to payments for Public Service Loan Forgiveness. Only months when you make a payment on an income-driven plan while working in a may have access to public service job count toward the 120-payment requirement.

Can my loan go into default while I am in forbearance?

No. Forbearance protects you from default. As long as your forbearance is active and approved by your servicer, your loan cannot be reported as delinquent or go into default, even though you are not making payments.