Federal loan deferment is used in a number of circumstances and many students take advantage of this benefit prior to law school, while in law school and even during the repayment years after law school. It’s important to know the status of your loans in order to understand how the rules of deferment apply to your loans. There are three main categories your loans could fall into:
- Loans taken out prior to law school
- Loans taken out after law school
- Loans taken out during law school for which you may be eligible for a postponement of payment
Loans taken out prior to law school:
If you borrowed loans prior to entering law school and deferred those loans while enrolled at HLS, you will now need to contact your lender to find out when they go into repayment. It may be that you have used all of your grace period and are to begin repayment 30 days after the last day of class (not graduation date). However, you may not have used your grace period and thus still have a number of months before you are required to make a payment, depending on the program. Again, you will need to contact each lender in order to find out when your first payment is due.
Keep in mind that you are responsible for the repayment of the loan even if the bill goes to the wrong address. Hopefully you have been in contact with your lenders during your time at HLS in order to update your address as often as necessary. If you are unsure of your prior loan history, you will need to look it up on the National Student Loan Data System. This site will give you your federal loan history. If you borrowed non-federal loans, and are uncertain as to who your lender is, you will need to contact the school through which you borrowed the funds. They may be able to help you contact the private loan company if you do not have those records. If they cannot help you, keep in mind that all loans are listed on your credit report. While each credit report (Experian, Equifax, and TransUnion) has similar information, you’ll want to look at all three reports to ensure that you have accounted for all of your borrowing history and to verify that all of the information is correct.
Loans taken out after law school:
If you decide to continue your education by enrolling, at least part time, in a degree seeking program you can defer your federal loans (Direct/FFELP Stafford, Perkins and Grad Plus). The loans will defer in the same way they did while you were enrolled at HLS. In other words, if the loan accrued interest while you were enrolled at HLS, then it will continue to accrue interest while you are pursuing your new degree. If the loan was subsidized, then you will not accrue interest while enrolled in your new degree program. You should always contact the lender to verify their deferment policy and procedures. Many lenders have an online application making the deferment process very easy. Be sure to check on the status of your loan once you do submit a deferment form since the lender will require a payment from you if the deferment is not received or approved by the payment due date.
Economic Hardship Deferment, Unemployment Deferment, Military Service or Post Active Duty Deferment:
There are several other types of deferment. Many students who go into a clerkship will request Economic Hardship Deferment for the length of their clerkship. Talk to your lenders about economic hardship deferment options. If you are unemployed during a deferral period or at any point in time during repayment, you may qualify for an unemployment deferment on your federal loans. Similarly, if you are in active military service or post active duty, you may qualify for a deferment on your federal loans. If you qualify for any of these deferment options, your subsidized loans will continue to receive their subsidy, i.e. the federal government will pay the interest on these loans during your deferment period.
For more detailed information on deferment go to StudentLoans.gov.