What is Delinquency?

Delinquency on your loan occurs if you do not make a payment on time or make application for a deferment on time.  All delinquency is reported to the credit bureau and therefore, it is wise to contact your school or Servicer if a scheduled payment cannot be made.  There are many options available to avoid delinquency such as deferments, forbearance or low-income extensions.

Forbearance

A forbearance is a temporary reduction in your monthly payments based upon your financial situation.  You may receive up to 36 months of forbearance over the life of your loan.  A forbearance is negotiated between you and your school or Loan Servicer based upon your unique situation.  To apply for a forbearance, you must contact your service representative.

Low-Income Extention

A low-income extension allows your school or Servicer to extend the payout time on your loan for up to an additional 10 years if your annual income does not exceed the federal mininimum wage standards or you have other exceptional financial dificulties.  A low-income extension will reduce your monthly payment obligation for up to a year at a time.  A low-income extension is negotiated between you and your school or Loan Servicer based upon your unique situation.  To apply for a low-income extension, you must contact your service representative.