Perkins Loan Deferment Options

TABLE OF CONTENTS

• General Information
• Student Deferment
• Economic Hardship Deferment
• Unemployment Deferment
• Forbearance
• Military Deferment
• Rehabilitation Training Deferment

GENERAL INFORMATION

There are many kinds of deferment available for your Perkins Loan.  In general, a deferment postpones repayment of the loan until a future date.  During most, but not all deferments, both principal and interest will be deferred and a six-month grace period will follow the deferment.  UNI’s policy is to apply deferments for no more than one year into the future, including the grace period.

If you believe you have filed for deferment and you continue to receive bills or past due notices, contact this office right away.  Either the deferment request was not received, an error was made, or we require further information from you. 

Any Exit Interviews must be completed before any deferments will be processed.

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STUDENT DEFERMENT

All Perkins Loans are eligible for student deferment as long as you are at least a half-time student.  As long as you remain at least half time and our office has the required information, there is no time limit on student deferment. 

UNI participates in the National Student Loan Clearinghouse (NSLC).  If your school also participates, we will be notified automatically if you are attending at least half time so no form will be required from you.  If your school does not participate in NSLC, then you will need to get an enrollment verification from the Registrar’s Office of your new school and send it to our office by fax or mail. 

The grace period following a student deferment will be nine-months if you are still in your original grace period when you go back to school and six-months if you have already used your original grace period. 

During student deferment and during the following grace period, no payments are due and no interest accrues.

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ECONOMIC HARDSHIP DEFERMENT

Economic hardship is indicated for those borrowers who:

1. Have received an economic hardship on another federal student loan.  An economic hardship deferment is different from a forbearance -- your documentation must state you have received an economic hardship deferment.OR  

2. Are receiving assistance from a federal or state source.  Examples are, but are not limited to, AFDC, SSI, Food Stamps, or FIP.

            YOU MUST PROVIDE:

1. Proof of your average monthly gross and net income.  Copies of pay stubs must be provided.  It must be clear on the pay stub how many weeks it covers.

2. Proof that you are receiving public assistance.  A copy of your benefits from your agency that show the dates that you have been eligible must be provided.OR 

3. Proof that you have received an economic hardship on another federal student loan.  This must be a copy of a letter from your lender/servicer showing it is under this type of deferment, not forbearance.

This deferment will defer your principal and interest plus a six-month grace period following.  No payments are required during any of this time.

THREE-YEAR MAXIMUM ALLOWED OVER THE LIFE OF YOUR LOAN.

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UNEMPLOYMENT DEFERMENT

Unemployment deferment is indicated if you are not working or only working part-time, but have been looking for full-time employment but have been unable to find it. 

YOU MUST PROVIDE either proof from your unemployment office that you have signed up for benefits, a copy of pay stubs or a letter from your employer showing only part-time work, or, if none of these is available, an affidavit written by you.

An affidavit written by you must show the dates you became less than full-time, general circumstances, explain that you are looking for full-time work, but have been unable to find it, and explain how long you think you will be in this status.

This deferment will defer your principal and interest plus a six-month grace period following.  No payments are required during any of this time.

THREE-YEAR MAXIMUM ALLOWED OVER THE LIFE OF YOUR LOAN.

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FORBEARANCE

Forbearance deferment is indicated if your situation does not fit into either the economic hardship or unemployment criteria.  Forbearance is indicated when your present financial circumstances don’t allow you to make your payments, or you have poor health, or you are required to care for a family member with poor health, or you are on a national military mobilization or you are working for Ameri-Corps as a volunteer (under a reimbursement agreement with them), or for some other acceptable reason.

Documentation that is required should back up the reason you are applying for this deferment.  For example, if you are in poor health, a statement from your doctor stating you are unable to work full-time based on your health would be appropriate.

You are required to complete a simple financial statement and provide documents to substantiate this information. 

Interest will continue accrue during a forbearance and there is no grace period following the deferment.  Repayment will resume at the regular monthly payment amount when the forbearance ends and will pay all accrued interest before it starts to repay on the principal balance.

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MILITARY DEFERMENT

During any period when you are serving on active duty during a war or other military operation or national emergency, or if you are performing qualifying National Guard duty during a war or other military operation or national emergency

If your active duty period includes October 1, 2007 or starts after that date, you are eligible for an additional 180 days following your demobilization date. 

If your active duty period includes October 1, 2007 or starts after that date, for at least a 30-day period, you are eligible for up to 13 months deferment following the conclusion of your active duty service.  You must have been in school as at least a half-time student at the time of your call to active duty or must have been a student within six-months of being called to active duty to qualify.

Active duty does not include active duty for training or attendance at a service school or employment in a full-time permanent position in the National Guard unless you are reassigned from that position to another form of active duty service. 

No interest accrues and no payments are due during the deferment or the six-month grace period following the deferment.

TO RECEIVE THE DEFERMENT:  Either you or your representative must notify this office of your call to active duty for the reasons previously stated.  A copy of your orders will be required to continue the deferment after the first year.

GENERAL PROCESS:  We apply military deferments no further into the future than one year, including the six-month grace period.  This usually coincides with your anniversary date of active duty and is a good reminder that you need to provide proof of continued active duty service.  During this time, no interest accrues and no payments are due.  You must file a new form every year to remain in a deferment status.

We will contact you during the grace period of your deferment to let you know when the deferment ends.  If you or your representative does not provide proof of continued service, or you become ineligible for this deferment, the notices will tell you when repayment will start on your loan.

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REHABILITATION TRAINING DEFERMENT

Participation as the recipient of services in a course of study in an approved rehabilitation-training program for disabled individuals may qualify some Perkins Loan borrowers for deferment of repayment.

TO QUALIFY FOR DEFERMENT:  You must be receiving, or be scheduled to receive, training services under a program designed to rehabilitate disabled individuals.

YOUR REHABILITATION AGENCY:

1. The agency must be licensed, approved, certified, or otherwise recognized by one of the following entities as providing rehabilitation training to disabled individuals:

1. A state agency with responsibility for vocational rehabilitation; or 

2. A state agency with responsibility for drug abuse treatment programs,o

3. A state agency with responsibility for mental health services programs, or

4. A state agency with responsibility for alcohol abuse treatment programs, or

5. The Department of Veterans Affairs

 

2. The agency must provide you (the recipient) with rehabilitation services under a written plan that:

1. Is individualized to meet your needs.

2. Specifies the date on which the services are expected to end, and

3. Requires a substantial commitment by the participant.

A substantial commitment is defined as:  A substantial commitment is a commitment of time and effort that would normally prevent an individual from engaging in full-time employment either because of the number of hours that must be devoted to rehabilitation or because of the nature of the rehabilitation.

TO RECEIVE THE DEFERMENT:  Contact our office for the requirements.

GENERAL PROCESS:  We apply rehabilitation deferment no further into the future than one year, including the six-month grace period.  This usually coincides with your anniversary date of starting your training and is a good reminder that a new form needs to be done.  There is no time limit maximum for this deferment, so as long as you remain in an eligible program and file the proper forms, meeting all the criteria above, you will remain eligible to defer.  A six-month grace period follows each period of deferment.  During both the deferment and the grace period following, no payments are due and no interest accrues.  You must file a new form every year to remain in a deferment status.

We will contact you during the grace period of your deferment to let you know when the deferment ends and that it is time to file a new form if you are still participating in the rehabilitation program.  If you are finished with the program, the notices will tell you when repayment will start on your loan.

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