Student loans are expensive — borrowers in their 20s make average monthly payments of $351.
Unfortunately, making monthly student loan payments can become impossible if you experience a setback such as a job loss or serious illness.
If you can’t pay your student loans, you have options. Most federal student loans offer deferment and forbearance to temporarily pause payments. Many borrowers who are repaying private student loans can take advantage of similar borrower protections, too.
But not all private lenders allow you to push pause on your monthly payments. If that kind of flexibility is important to you, you’ll need to research lenders carefully.
Whether you’re looking for private student loans while in school or lenders offering student loan refinancing, check out these six private lenders with great repayment protections.
- SoFi offers loan deferment for borrowers who return to graduate school at least half-time, who are undergoing rehabilitation for a disability, or who are serving on active duty in the military. Interest continues to accrue during deferment.
- Student loan forbearance is also available for borrowers who are terminated from their jobs through no fault of their own. Borrowers can postpone their monthly payments for three months at a time and for a maximum of 12 consecutive months. Interest continues to accrue during forbearance.
- Loans can be in forbearance for a total of 12 months during the life of the loan.
- Borrowers must work actively with SoFi’s Career Strategy group while loans are in forbearance. A career strategist helps borrowers to find a new job by developing a personal brand, charting a career path, updating resumes, and preparing for interviews.
- CommonBond allows academic deferment for borrowers who return to school. Interest continues to accrue during deferment.
- CommonBond provides for loan forbearance through its CommonBridge program for borrowers experiencing financial hardship. Borrowers can postpone monthly payments for three months at a time for up to 12 consecutive months total, although interest continues accruing while payments are suspended.
- Loans can be in forbearance for a total of 24 months during the life of the loan.
- The CommonBridge program helps borrowers enhance their careers through networking opportunities. Members who are between jobs may also be matched with consulting opportunities to earn income.
3. Laurel Road
- Laurel Road provides loan forbearance for borrowers facing financial hardship due to a job loss, maternity leave, or other qualifying reasons. Interest accrues while loan payments are suspended.
- Borrowers may be eligible to postpone payments through forbearance for one or more three-month periods.
- Loans can be in forbearance for up to 12 months during the life of the loan.
- For loans originated after spring of 2015, Laurel Road will forgive the outstanding loan balance if the borrower dies or demonstrates that a permanent disability has caused a significant and permanent income reduction.
- Earnest offers up to 36 months of student loan deferment if you’re attending graduate school, serving in the Peace Corps, or serving on active duty in the military. Interest continues to accrue.
- Earnest offers forbearance for involuntary decreases in income or the loss of a job, as well as for parental leave or circumstances where borrowers experience significant expenses including home repairs or medical bills.
- Earnest discharges student loans if the borrower dies or becomes permanently disabled.
- With LendKey, forbearance is approved based on economic hardship at the discretion of the lender.
- If you’re approved, forbearance is available for up to six months at a time, and interest continues accruing while the loan is in forbearance.
- Loans can be in forbearance for a maximum of 18 months total during the life of the loan.
Applying for borrower protections while repaying private student loans
The process of applying for student loan deferment or forbearance will vary by lender. For example:
- SoFi borrowers will need to complete a deferment request form and provide proof of eligibility, including proof of military service, participation in a rehab program, or attendance in a qualifying educational program. When applying for student loan forbearance, SoFi borrowers must prove they’ve applied for unemployment benefits.
- If you’ve borrowed through Laurel Road, forbearance requests are reviewed to determine if the borrower is experiencing a qualifying economic hardship. The hardship doesn’t necessarily need to be a job loss. Laurel Road reviews requests for forbearance on a case-by-case basis and requires updated documentation proving the nature of your economic hardship.
- LendKey makes it easy to apply for student loan forbearance by making request forms available on its website. However, an approval of forbearance request is not guaranteed. The application requires information on employment, income, and expenses, and you must give LendKey permission to check your credit.
Since each lender offers its own options for private student loans with deferred payments, contact your lender directly if you can’t make your payments. Your lender can explain the process to pause payments and help you to complete any necessary forms.
All lenders require some form of documentation, however, so start preparing proof of economic hardship now. This could include information about your expenses, proof of health issues, or a record of applying for unemployment benefits.
Finally, before applying for deferment or forbearance, consider the impact of interest continuing to accrue on your loan. While putting loans into forbearance is a much better solution than defaulting on a loan, remember that paying back your loan will ultimately cost more if you’ve taken advantage of student loan deferment or forbearance.
Need a student loan?Here are our top student loan lenders of 2018!
1 = Citizens Disclaimer.
2 = CollegeAve Autopay Disclaimer: All rates shown include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
3 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.
|3.54% - 12.07%2||Undergraduate, Graduate, and Parents||Visit CollegeAve|
|4.11% - 12.19%||Undergraduate and Graduate||Visit Ascent|
|4.00% - 11.85%*3||Undergraduate and Graduate||Visit SallieMae|
|2.93% - 9.67%||Undergraduate, Graduate, and Parents||Visit CommonBond|
|3.80% - 11.99%1||Undergraduate, Graduate, and Parents||Visit Citizens|
|4.53% - 9.69%||Undergraduate and Graduate||Visit LendKey|