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HomeNewsHere's what borrowers need to know as student loan interest resumes

Here’s what borrowers need to know as student loan interest resumes

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Drazen Zigic | Istock | Getty Images

1. In-school borrowers

2. Recent graduates

Most graduates get a so-called grace period after they’ve finished school before they need to start making their student loan payments. This period is usually six months, although in some cases, it’s nine months.

You won’t see the interest on your undergraduate subsidized loans collect until you’ve exited this window. Again, unsubsidized loans continue to grow.

Months during the pandemic-era pause count toward your grace period, Kantrowitz said.

3. Those struggling

Those who qualify for a hardship deferment include people receiving certain types of federal or state aid and anyone volunteering in the Peace Corps, Kantrowitz said.

With both a hardship and an unemployment deferment, interest generally doesn’t accrue on undergraduate subsidized loans. Unsubsidized loans will rack up interest.

The maximum amount of time you can use an unemployment or hardship deferment is usually three years, per type.

Other, lesser-known deferments include the graduate fellowship deferment, the military service and post-active duty deferment and the cancer treatment deferment. You should ask your servicer if your loans will continue to grow under these varied options because each case is different.



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