> Unpaid interest on Direct Loans and Federal Family Education Loan (FFEL) Program loans managed by the U.S. Department of Education (ED) capitalizes
> * after a deferment on an unsubsidized loan; or
> * if you are repaying your loans under the income-based repayment (IBR) plan and no longer qualify to make payments based on income or leave the IBR plan.
You’re in a forbearance specifically, which isn’t a capitalizing event for Direct loans currently. It used to be, but that changed under the Biden-era Negotiated Rulemaking session with one of the (many) changes that became effective July 2023
3 Comments
No.
No
Let’s quote https://studentaid.gov/understand-aid/types/loans/interest-rates
> **When does unpaid interest capitalize?**
> Unpaid interest on Direct Loans and Federal Family Education Loan (FFEL) Program loans managed by the U.S. Department of Education (ED) capitalizes
> * after a deferment on an unsubsidized loan; or
> * if you are repaying your loans under the income-based repayment (IBR) plan and no longer qualify to make payments based on income or leave the IBR plan.
You’re in a forbearance specifically, which isn’t a capitalizing event for Direct loans currently. It used to be, but that changed under the Biden-era Negotiated Rulemaking session with one of the (many) changes that became effective July 2023