More than 42 million Americans face student loan debt, with over 50% of borrowers, approximately 25.5 million, utilizing forbearance as of September 2022.
Deferment and forbearance are useful when payments become unmanageable, as they help borrowers prioritize other obligations, but interest continues to accrue.
Travis Hornsby explains that borrowers might choose deferment or forbearance when struggling with income-driven repayment plans or awaiting public student loan forgiveness.
While federal student loan forbearance allows payment pauses, interest still accrues, leading to potentially higher balances unless interest payments are made during forbearance.
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