College Loans, Forebearance and Deferals

This personal experience comes from VISTA Nicole Bellanger:

I graduated this May and currently my Stafford loans are in a grace period until November. I called the Direct Loan program to make sure I understood everything before submitting my forbearance request and it turns out there was a lot I did not understand.

Because my loan is in its Grace Period, and the loan provider is required by law to provide a 6 month grace period, they are not able to put my loan into forbearance until the grace period ends. I was concerned because I wasn't sure if the interest accrued on my loan before I go into forbearance would be covered by Americorps and every little bit of help paying those loans is going to be helpful. The Direct Loan program did not have the information I needed and suggested that the interest accrued before my grace period ends would not be covered by AmeriCorps.

Not wanting to take no for an answer and being a little confused, I called the VISTA Member Support Unit and they put me in touch with someone who deals directly with the Segel Ed. Award. That person cleared up my confusion, letting me know that although I am not able to put my loans into forbearance until my grace period ends, AmeriCorps will cover the interest that accrues between my first day of service and the last day of my service, whether the loan is in forbearance or in the grace period. Hope I understood her correctly.

Another important thing you guys may need to know - if your loan is in the grace period your loan provider will reject any request you make to put it into forbearance, because by law they need to give you a 6 month grace period. I was told to submit the forbearance request through my.americorps.gov 2 weeks before my grace period ends (not before 1st payment date) and to then call my loan provider to make sure the forbearance req. has gone through.