Deferment or Forbearance

I graduated in 2007 and, because I’m still looking for a financially stable job, I requested and recieved a deferment/forbearance on my student loans for reason of economic hardship (it seems no one is hiring grads these days). My question is whether or not this will affect my credit score?

Lisa 

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Hi Lisa,

There is a difference between student loan deferment and forbearance.  A student loan deferment for a subsidized loan permits the borrower to delay repayment without accruing interest.  With student loan forbearance, interest continues to accrue. 

Forbearance may be requested orally while a deferment will only be granted if the borrower requests it in writing.  The Department of Education has deferment program forms at Ed.gov

Don’t worry about the credit reporting implications of either.  You’re doing the right thing by being proactive.  Make sure you get everything in writing and check up on your credit report to verify that it’s reporting accurately.  At the end of all of this, you will have some aged tradelines that will certainly boost your FICO score for length of credit history.

Thanks for the questions and hope this helps.

Paul