Student loan payment postponement: What you need to know

Student loan deferment, forbearance, cancellation, and default: The full breakdown. Full transcript below: If you're having trouble paying back your student loans, you have the option of changing to a new payment plan or consolidating your loans into one single loan, which may offer you a lower monthly payment. But sometimes that isn't enough. You may have fallen on hard times and it’s tough to keep paying. In these cases, you can try deferring or even cancelling your loan. The last thing you should do is stop paying. Going rogue will damage your credit and cost you late fees. It can also result in you being sued and having your wages and tax refunds garnished. You might qualify for postponement instead. Let's look at the two forms of postponement. One is deferment and that lets you out of making loan payments for a certain length of time. The other is forbearance and it’s similar to deferment and easier to get. Your payments are postponed (or reduced) for a period of time due to financial or another difficulty. Generally, you can get a forbearance if you aren't eligible for a deferment. With a forbearance, the interest on your loan will continue to accrue, meaning that you are responsible for paying it. With a deferment, interest does not accrue. Student loan deferment is nice, but getting your loans canceled is a dream come true for grads. It's not as easy as a deferment, and don’t count on getting the entire balance canceled. If you’re about to default do your research to learn about your options like loan consolidation, payment relief, or repayment plans. If your loan is already in default, you can rehabilitate it and be freed from garnishment and other actions against you. Deferment, forbearance, and cancellation can be welcome possibilities to the new graduate just starting out. Defaulting can be a disaster. Make sure to include your student loan payment in your financial planning so that they don’t hurt your chances of getting loans in the future. Not getting a car loan, business loan, or mortgage because of student loan default can hurt not just your professional career, but your private life. Stay financially fit, friends!