A grace period is the period of time before the borrower must begin or resume repaying a loan. An initial grace period immediately follows your first exit from school after a period of enrollment and immediately precedes the date payment is required to begin for the first time. This initial grace period is nine months long, calculated from the first day of the month following the month you exit. For example: if you leave in May, your initial grace period begins in June and your first payment is due March 1st.

You may also qualify at some point during your payment for a post-deferment grace period. A deferment is a period of time in which you do not have to make your scheduled payments. Types of deferments include deferments for cancellation benefits, academic deferment for enrollment more than half-time at an institution of higher education, forbearance, rehabilitation training approved for disabled individuals and unemployment while actively seeking full-time work. Interest does not accrue during grace periods but resumes with the first regular payment. Post deferment grace periods are always six months long after each period of qualifying deferment. A full reference section on deferments is available on another link.

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