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I'm Unemployed / Underemployed. What are My Options?
The U.S Bureau of Labor Statistics reported that the national unemployment was 8.1% in February 2009 and is on the rise.
Paying back your student loan on time is an important responsibility but it can be tough when curve balls are thrown at you. National Education is here to assist you in managing your student loan during the good times and those tougher times.
If you are unemployed / underemployed and have a student loan in repayment or your loan is about to enter repayment, help is available. You may be eligible for an Unemployment Deferment while searching for full time employment because you:
- Recently graduated
- Are working less than 30 hours a week
- Left school or are enrolled less than half-time
- Were laid off by your employer
- Lost your job
What is an Unemployment Deferment?
An Unemployment Deferment will enable you to temporarily postpone making your monthly student loan payments during a specific time period. Deferments are an entitlement to help borrowers manage their Federal Stafford, PLUS, GradPLUS and Consolidation loans.
Things to Know about an Unemployment Deferment
When considering an Unemployment Deferment, be aware:
- If the loan is in repayment and the student or borrower is enrolled at least half time, an In-School Deferment should be used instead.
- You are expected to be actively searching for a full time job during the Unemployment Deferment.
- You must be registered with an employment agency or be eligible to receive unemployment benefits.
- During the deferment, the interest for a subsidized Stafford Loan is paid by the federal government. For an unsubsidized Stafford, PLUS or GradPLUS loan, the borrower is responsible for paying the interest at all times. The interest may be paid quarterly (to save money) or accrued and capitalized when the loan goes back in repayment at the end of the deferred period.
- You must reapply for an Unemployment Deferment every 6 months. You must verify that during this time you made at least 6 diligent attempts to find employment but were unable to do so.
- One Unemployment Deferment can be applied to all your federal loans serviced by National Education.
- Deferments do not apply to private loans.
- If you obtained your FIRST loan before 7/1/1993, you are eligible for a maximum of 2 years of Unemployment Deferment. If you obtained your FIRST loan on or after 7/1/1993, you are eligible for a maximum of 3 years of Unemployment Deferment.
- Once employed, you are expected to notify us of the good news.
How to Request an Unemployment Deferment
Completing an Unemployment Deferment form is easy but it's important that you act quickly. Your payments will continue to be required until the deferment request is completed, submitted, and approved.
To initiate the process, download and complete the Unemployment Deferment
form. Follow the instructions on the form. Once complete, this form and any supporting documentation can be faxed to (800) 345-9588 or mailed to:
Helpful Hints: Section 2
Item 1: The first date requested on the form is the date you became unemployed or started working less than 30 hours per week. The deferment will begin on this date unless you provide a later date in the space provided. The deferment may never begin more than 6 months before we receive your request.
Item 2: Choose A or B as it applies to your situation. When selecting B, you must submit documentation to prove the dates you are eligible to receive unemployment benefits (must show start and end dates, as well as amounts to be paid).
Remember, deferments are here to help you manage your student loan. For a list of additional deferments, click here.
Questions? Contact our Customer Service department at customerservice@nationaled.net or (800) 345-4325.