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Frequently Asked Questions

Mandatory Forbearances

A Mandatory Forbearance resembles a deferment, in that your lender must grant it to you if you request it and if you qualify.  It resembles a forbearance in that you are responsible for interest on your loans during the mandatory forbearance period, even if interest was paid by the government during your in-school period.  As in any forbearance period, you may continue to make monthly payments to cover interest, or you may allow the interest that has accrued during the forbearance to be capitalized, or added to the principal balance of your loan(s).  This means that you will pay interest on a higher balance when you resume payments, possibly causing your monthly payment amount to go up.

A mandatory forbearance may be granted for the following reasons:

Internship or Residency  
If you are a medical or dental intern or resident and you either do not qualify for an internship/residency deferment (i.e., the earliest of your outstanding loans was borrowed after 6/30/1993), or you have exhausted your deferment eligibility, you may qualify for a mandatory forbearance.  To qualify, you must be engaged in a program that:

bullet Must be successfully completed before you may begin professional practice or service, or
bullet Leads to a degree or certificate awarded by an institution of higher education, a hospital, or health care facility offering postgraduate training.

The mandatory forbearance for internship/residency is available as long as you continue to meet eligibility criteria.

Debt Exceeds Monthly Income
The lender must grant a forbearance in yearly increments for up to three years, if you are obligated to make payments on Title IV loans (i.e., FFELP, Federal Direct Loans, and Federal Perkins Loans) and the total of monthly payments is 20% or more of your total monthly income.

National Service, Loan Forgiveness, or Department of Defense Repayment
The lender must grant a forbearance in yearly increments for any period during which you:

bullet Serve in a national service position for which you receive a national service educational award under the National and Community Service Trust Act of 1993 (AmeriCorps); or
bullet Maintain eligibility for loan forgiveness under the Stafford Loan Forgiveness Demonstration Program (if the program is funded) for performing the required type of service; or
bullet Performs service that would qualify the borrower for partial loan repayment under the Student Loan Repayment Programs administered by the U.S. Department of Defense.

The mandatory forbearances described require you to complete a request form for your lender or servicer.  Click here to access a list of servicers and contacts.

Mandatory Administrative Forbearance
There are also types of mandatory forbearance that your lender or servicer can apply to your account without a written request.  This type of postponement of payments is called a Mandatory Administrative Forbearance.  Although no written request is needed, your lender or servicer, when applying such a postponement, must send you a notice stating that you:

bullet May decline the forbearance and continue to be obligated to make scheduled payments; or
bullet Consent to make payments in accordance with the notification if the forbearance is not declined 
  

Mandatory Administrative Forbearances may be granted for the following conditions:

Graduated or Variable Interest Repayment Extension
Your lender or servicer may extend your repayment period for up to three (3) years, if your account will not be paid in full within the standard 10-year period because of the effects of a graduated repayment schedule or annual changes in variable interest rates (See Graduated and Income-Sensitive Repayment Schedules).

Income-Sensitive Repayment Extension
Similarly, your lender or servicer may extend your repayment period for up to five (5) years if the reduced payments of an income-sensitive repayment schedule cause your account to not be paid in full within the standard 10-year period (See Graduated and Income-Sensitive Repayment Schedules)

For the following three types of forbearances, the lender is not required to notify the borrower at the time forbearance is granted. The lender must grant a forbearance to a borrower or endorser during any period, and during the 30 days following the period, when the lender is notified by the U.S. Department of Education of any of the following conditions:

bullet Local or National Emergency.
During periods of emergencies, the lender may not require a borrower to submit a request for the forbearance or supporting documentation. 
 
bullet Military Mobilization. 
Defined as a situation in which the U.S. Department of Defense orders members of the National Guard or the Reserves to active duty.  A military mobilization also includes the assignment of other members of the Armed Forces to duty stations at locations other than the locations at which they are normally assigned.  The lender must require a borrower or endorser who requests forbearance because of a military mobilization to provide documentation showing that the borrower is subject to a military mobilization as described above.
 
bullet Disasters. 
A lender must grant a forbearance for a borrower if the geographic area in which the borrower resides has been designated as a disaster area by the president of the United States or Mexico, the prime minister of Canada, or by a governor of a state Disasters. 
  
A lender must grant a forbearance for a borrower if the geographic area in which the borrower resides has been designated as a disaster area by the president of the United States or Mexico, the prime minister of Canada, or by a governor of a state. The lender may not require a borrower to submit a request for the forbearance or supporting documentation.

If you don’t think that a forbearance is the best option for you return
to the Questionnaire to make another selection.




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