Understanding Student Debt: Deferment, Forbearance and Consolidation

Last Updated on May 23, 2023

Understanding Student Debt: Deferment, Forbearance and ConsolidationA lot of people equate graduate school with a serious amount of debt. In most cases, it is worth it to go into debt for school. A college education can lead to higher paying jobs and a more fulfilling life. Unfortunately, college costs have skyrocketed in recent years, forcing most young people to obtain a lot of loans to pay for school. A lot of people seek ways in which they can pay off their student loans with ease. There are multiple options, including deferment, forbearance and consolidation.

Debt Deferment

Depending on your circumstances, you can defer your student loan debt. You can do this in cases that you are unable to make payments This can be the case of losing your job, having a poor financial situation temporarily or if you go back to more school. With deferment, you will not have to make any payments on your loan. in some cases, the government will actually pay your interest for you. With a deferment, you are not avoiding paying back the loan, you are just delaying the payments. This is best for anyone that is in a short-term bind.


If you are unable to make your payments and do not qualify for a deferment, you should look into a forbearance. With forbearance, it is possible to not make payments or to lower your payments for up to one year. You will continue to accrue interest on your loans. A forbearance is harder to qualify for; you must have an illness or a financial hardship. To see if you qualify for a forbearance, you should immediately contact the company the lending company.


A lot of people can benefit from consolidating their school loans. This is a great option for someone with a lot of debt. By consolidating, you can lower your monthly payments and get a better interest rate. Remember, interest rates on school loans are usually much lower than other interest rates. Since the interest is deductible, a lot of people are not in a hurry to pay off their student loans. You should look at your financial situation before deciding on if consolidation is the right option.

Get Help

A lot of people can get their student loans paid by someone else. If you are in a certain profession, the government and even some organizations may help. For example, a teacher who teaches in an underprivileged area may qualify to have their student loans forgiven. This is the same for nurses, doctors, or many other professionals that are encountering the possibility of a job that endures hardship and little financial incentive. If you are considering this option, weight the cost of the possible lower salary.

Remember, it was probably worth it to incur your debt and a little student debt is not necessarily bad. This is especially true when comparing it to other kinds of debt. One great thing about student debt is the fact that you can write it off on your taxes. Not only that, student loan interest rates are at historic lows, so if you play your cards right, you can really manage your loans quite well.

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