Friday, July 3rd, 2009
Question about student loan deferment?
bendypants asked:
I recently began attending graduate school part time. Today I got a letter from AES (the company through which I consolidated me student loans) that said that my loans are now in deferment! I honestly didn’t even think about defering my loans, but I’m not unhappy about it. My question is… can I make payments sporadically while in deferment? And what effect will this have on my interest rate? It is really low right now and I am one payment away from having a rate reduction. Any information would be great!
I recently began attending graduate school part time. Today I got a letter from AES (the company through which I consolidated me student loans) that said that my loans are now in deferment! I honestly didn’t even think about defering my loans, but I’m not unhappy about it. My question is… can I make payments sporadically while in deferment? And what effect will this have on my interest rate? It is really low right now and I am one payment away from having a rate reduction. Any information would be great!
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July 4th, 2009 at 2:42 pm
A deferment is a good thing (if you are a lender) because they get to add more money to your principal (how much you owe) and it gives you a longer time to pay on them… more time for the interest to capitalize (be added to the principal and then essentially you pay interest on the interest).
Deferment is good for the lender only. If it honestly never occurred to you to defer, then you need to get them OUT of deferment and pay on them. save the deferment eligibility (you only have a limited amount of time to defer over the life of the loans) for a real emergency like if you suddenly become sick and have to quit working, for example.
Making payments while your loan is in deferment won’t change or reduce your interest rate. Make your regular payment and don’t them them JIP you of that rate reduction!!!