Students also have different repayment options such as deferment and forbearance if they're unable to pay back the loans temporarily. This type of deferment is allowed only up to six months at a time. Any form of deferment has a time limit of three years. A student can also file for forbearance, which is an extension on payments from six months to one year. Forbearance is a last resort granted at the lender servicer's discretion, and still incurs interest.
Students can also choose between various payment options.
The standard repayment plan requires the same payment for every month. The graduated repayment schedule slightly increases the amount owed, once every two years for the borrowers who are able earn more money as they advance in their careers. The income-sensitive option is for the borrowers who can make payments but have financial difficulties. Income-sensitive payments are lower. During a grace period, the federal government continues to pay the interest on subsidized loans.