STAFFORD LOAN
Stafford Loan Deferment

After you graduate, leave school, or drop below half-time enrollment, you have a period of time before you have to begin repayment. This “grace period” will be six months for a Federal Stafford Loan.  Many newly graduated students are finding it difficult to repay their student loan after the grace period due to the tough economic environment.  If you're having trouble making payments on your loans, contact your lender as soon as possible. Your lender will work with you to determine the best option for you.

Many students are turning towards a Stafford Loan deferment, which allows them to temporarily stop making payments on your loan.  Students are able to stop all Stafford Loan payments, until they are able to afford such a payment.  There are certain deferment criteria that must be met before being approved for this program. 
In order to qualify for a Stafford loan Deferment, you must hold a full-time teaching position in a federally designated teacher shortage area for a maximum of three years.

If you qualify for teacher service deferment and your loan is an Unsubsidized Stafford Loan, you must still pay the interest that accumulates on the loan during eligible periods of deferment. You would pay this interest either during the deferment period or it will be an increase in the amount or number of your monthly payments when you resume making payments.

Students with a subsidized Stafford Loan that qualify for a Stafford Loan Deferment are not required to pay the accrued interest durig deferment.  The federal government will pay this interest.  After the deferment period ends, you will not have to pay the additional interest that would have accrued on your Stafford Loan.
To obtain a teaching deferment, you must submit a deferment form to the Direct Loan Program for each school year of teaching service. A federally approved teacher shortage area can be a state region with a shortage of elementary or secondary school teachers or it can be a grade level, subject-matter, or discipline classification in which there is a statewide shortage of elementary or secondary school teachers. In both cases, the shortage must be identified by the state education agency and approved by the U.S. Department of Education.
It’s important to contact the Direct Loan Program adminsitration if you are finding yourself unable to pay your monthly recurring student loan payment.  If you don’t contact the program and stop payment then your credit score will be negatively impacted and you will not be able to receive another student loan in the future, until all payments have been made.  Even if you don’t qualify for a Stafford Loan deferment, letting the program know your financial situation will allow them to assist you in financing a repayment program that is right for you.




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