What is a forbearance?
A forbearance is a period during which the borrower is permitted to temporarily cease making monthly payments, or reduce the amount of the payments. The borrower is liable for the interest that accrues on the loan during the forbearance period. Some forbearances are entitlements for eligible borrowers; others are granted at the discretion of the lender.
Forbearance is a period of time during which a lender permits a borrower to temporarily cease making payments, to make reduced payments, or to delay payments. Forbearances are usually granted at the discretion of the lender. The borrower is responsible for the interest that accrues; and, if unpaid, the interest may be capitalized. Forbearances are often used to bring delinquent loans current in situations where there is a legitimate financial hardship, but the borrower doesn’t qualify for a deferment.
A forbearance is a short-term, temporary suspension of your payments or a reduction of your payment amount. Forbearance is intended to help you if you’re having financial difficulties and do not qualify for a deferment. If VSAC agrees to grant a forbearance, you are responsible for the interest that accrues on your loan(s) during the period of forbearance. Normally, VSAC will ask you to pay the interest during the forbearance, but in some circumstances, VSAC may allow you to add the interest to your balance at the end of the forbearance period. Keep in mind that if you add the interest to your principal balance, you will pay more interest in the long run. Loans in a default status are not eligible for this option.
