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How to Write an Effective Hardship Letter Part 1: Explain what happened and why you are applying. Part 2: Specifically illustrate the time and severity of the hardship. Part 3: Back up the reasons traditional remedies wont work. Part 4: Detail why you are stable enough to succeed with a modification.
If youre having trouble repaying your loans, you may consider requesting a loan deferment or forbearance: With a loan deferment, you can temporarily stop making payments. With a loan forbearance, you can stop making payments or reduce your monthly payments for up to 12 months.
Applying for deferment might be worth it if you have federally subsidized loans or Perkins loans, since these dont accrue interest during the deferment. However, its often a good idea to avoid deferring unsubsidized or private loans due to the high cost of accumulated interest.
Is deferment better than forbearance? Technically, yes. Deferment offers greater flexibility because you receive immediate mortgage relief and arent required to repay your missed payments until the end of your loan. Forbearance, on the other hand, will be more costly once your payments resume.
Find out if a deferment is the best option for your situation. With deferment, you wont have to make a payment. However, you probably wont be making any progress toward forgiveness or paying back your loan.
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A deferment period is an agreed-upon time during which a borrower does not have to pay the lender interest or principal on a loan. Depending on the loan, interest may accrue during a deferment period, which means the interest is added to the amount due at the end of the deferment period.
A student loan deferral doesnt directly impact your credit score since it occurs with the lenders approval. Student loan deferrals can increase the age and the size of unpaid debt, which can hurt a credit score. Not getting a deferral until an account is delinquent or in default can also hurt a credit score.
Deferments do not hurt your credit score. Unlike simply missing a payment or paying it late, a deferred payment counts as paid ing to agreement, since you arranged it with your lender ahead of time. Thats especially important if youre already in the kind of emergency that would call for a deferment.
A deferment period is an agreed-upon time during which a borrower does not have to pay the lender interest or principal on a loan. Depending on the loan, interest may accrue during a deferment period, which means the interest is added to the amount due at the end of the deferment period.
You may want to put your loans on deferment if your loans dont qualify for federal student loan relief and youve lost your job. You might also want to put your loans into deferment if youre just having a hard time meeting your basic needs.

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