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Subsidized Loan Deferment Questions

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Anonymous
Not applicable

Subsidized Loan Deferment Questions

Hello all! I have 6k in subsidized student loans from two years of community college, one semester left and I'll have my AA. Yay! Planning to apply for transfer to a couple university and state colleges but my junior year wouldnt start until fall 2015. I'm a little confused about my loans....they are currently listed on my CR as PDE in good standing and have probably been listed that way for awhile, which I believe is what has been helping my credit score. When I checked about a year ago all three scores were near 560. I never requested a deferment so it seems to have been done automatically but I have no complaints there. Smiley Very Happy The date listed to begin payments is January 2016. To remain in grace period deferment you must not have a gap between at least half-time enrollment longer than six months. My last semester at CC ends January 2015, fall semesters usually start in August for most schools.

 

Since I'll be out of school from mid January - mid August will I no longer be in deferment and have to start repaying the loans? Time between spring and fall semesters is technically a couple weeks over six months, not sure if enrollment in the fall guarantees I'll still be in deferment.

Is the date of January 2016 listed for payments to start a fixed date whether I'm enrolled in school or not?

Also is it a good idea to make payments on the loans while in deferment?

 

If I've misunderstood any of the deferment terms or obligations please feel free to correct me! Thanks for any assistance.

 

Message 1 of 5
4 REPLIES 4
empiror22
Regular Contributor

Re: Subsidized Loan Deferment Questions

The reason for the Jan 2016 date is that is the expected graduation date ( i know its wrong but if your a sophmore or freshman your expected grad from a 4 year is some time around Jan 2016) .  DO NOT go by this date as it will change as your school status changes ie change from full time to part time to taking a break....I would talk with your fin aid department at your current school for details.  but i know when i took a long break (over 6 months) they wanted me to start paying... however if you can't pay, or don't want to pay you can ask for a deferment until school starts back.    However since you are just over the 6 months and will be going back to school you may be able to have the loans stay on deferment like they are now as long as you have been accepted and are registered full time.  (in my case i was accepted and registered at my new school with a little over a month past the 6 months (7 total months DEC-AUG) and they kept me in deferment). 

 

As far as paying on the loan now or anytime it is defered while in school for subsidized loans, i personally do not.  since there is not accuring interest on subsidized loan while in school it don't save you any money or help (except you would owe less when done).  If you have a NON-SUB then yes pay some of those as to not have capitalizated interest ie. owe more money because you are charged interest while in school.

Message 2 of 5
Anonymous
Not applicable

Re: Subsidized Loan Deferment Questions

That clears up the confusion quite a bit. I dread having to talk to the financial aid department at my school about anything, you'll get three different answers from three diffferent people and usually all of them are wrong. Its a total nightmare. I dont mind starting the payments early but if there's a chance of deferment I'll take it. Just want to financially prepare for payments if necessary. The loan is through nelnet so I think I'll contact them before the spring semester ends just to make sure I'm still eligible for deferment until fall. Better to ask than assume. Hopefully they are easier to communicate with than my financial aid department Smiley Mad No non-subs so I'll refrain from making payments. Thanks!

Message 3 of 5
SCF
Valued Contributor

Re: Subsidized Loan Deferment Questions

Definitely get in contact with your lender.  You'll want to register for their online account management as well - that way you can easily monitor the status of your loans.  I believe your loan will come out of in-school deferrment because you will not be taking classes during the Spring semester, and that will start your 6 month grace period.  You only get 6 months of grace period, so be aware that when you do graduate, your loans will go into repayment sooner than someone who was in school continuously.

 

Keeping in contact with Nelnet and regularly checking their online system will let you know exactly what status you loan is in, and you can apply for a deferment online as well if you need one.  Since you have subsidized loans, a good idea would be to save money during your break so that you have a pool of funds for an emergency or to help you make payments once you graduate from your next school.

Message 4 of 5
Anonymous
Not applicable

Re: Subsidized Loan Deferment Questions

SCF thank you! I didn't realize there was an online account option. Turns out most of my nelnet emails have been going to my spam folder, including the one prompting me to set up an account Smiley LOL This is a great way to stay on top of things. I really appreciate the information. Take care

Message 5 of 5
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