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Student Loan Deferment & Forbearance Calculator

Education Finance calculator deferment forbearance student loan
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Student Loan Deferment & Forbearance Calculator

Compare the true cost of deferment vs. forbearance. See how interest accrues and capitalizes, so you can make the smartest choice for your federal or private student loans.

Loan Details
$
%
Unsubsidized: interest accrues during deferment but is not capitalized.
RECOMMENDED
Deferment

Interest may be subsidized. No capitalization.

Interest During Relief
$0
Principal After Relief
$35,000
Status
No capitalization
COSTLIER
Forbearance

Interest accrues and capitalizes at end.

Interest During Relief
$2,285
Principal After Relief (Capitalized)
$37,285
Long-Term Extra Cost
+$0/yr in interest
💰 Your Savings with Deferment
$2,285
Capitalization Avoided
$2,285 not added to principal
Detailed Comparison
Deferment Forbearance
Monthly Interest $0 $190
Total Interest (Relief Period) $0 $2,285
Interest Capitalized? No Yes
New Principal After Relief $35,000 $37,285
Estimated 10-Year Monthly Payment* $398 $424
Extra 10-Year Total Cost $0 +$3,120

* Estimated based on standard 10-year repayment plan after relief period ends. Actual payments may vary.

Frequently Asked Questions

Deferment is a temporary pause on student loan payments during which the government may pay the interest on subsidized federal loans. For unsubsidized loans, interest accrues but is not capitalized (added to principal). Forbearance also pauses payments, but interest accrues on all loan types and is typically capitalized at the end of the forbearance period, increasing your total debt. Deferment is generally the better option if you qualify.

It depends on your loan type. For Direct Subsidized Loans and Perkins Loans, the U.S. Department of Education pays the interest during deferment, so no interest accrues. For Direct Unsubsidized Loans, PLUS Loans, and most private loans, interest continues to accrue during deferment but is not capitalized until after the deferment ends (if at all).

Interest capitalization occurs when unpaid accrued interest is added to your loan's principal balance. After capitalization, future interest is calculated on the new, higher principal. This means you pay interest on interest, significantly increasing the total cost of your loan over time. Forbearance typically triggers capitalization; deferment usually does not.

Deferment length depends on the type of deferment you qualify for. Common deferment types include: In-School Deferment (while enrolled at least half-time, unlimited duration), Economic Hardship Deferment (up to 3 years), Unemployment Deferment (up to 3 years), and Military Service Deferment (duration of active duty + 180 days). Forbearance is generally more flexible but costlier.

Yes! You can always make voluntary payments during deferment or forbearance without penalty. Making even small payments toward accruing interest can significantly reduce the long-term cost. For unsubsidized loans in deferment, paying at least the accruing interest prevents it from piling up. There are no prepayment penalties on federal or most private student loans.

Neither deferment nor forbearance directly hurts your credit score, as the paused payments are reported as "current" to credit bureaus. However, the long-term financial impact of forbearance (due to capitalization) can make repayment harder later, potentially increasing the risk of missed payments down the road. Deferment is generally the safer choice for both your wallet and your credit health.

Federal student loans offer several deferment options: In-School Deferment (enrolled at least half-time), Graduate Fellowship Deferment, Rehabilitation Training Deferment, Unemployment Deferment, Economic Hardship Deferment, Military Service Deferment, Post-Active Duty Deferment, and Cancer Treatment Deferment. Contact your loan servicer to apply and confirm eligibility.

This calculator uses the standard amortization formula to estimate monthly payments under a 10-year (120-month) repayment plan after the relief period ends. The formula is: PMT = (r × PV) / (1 − (1 + r)−n), where r is the monthly interest rate, PV is the principal, and n = 120 payments. For forbearance, the capitalized (higher) principal results in larger monthly payments.
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