September 10, 2009

Do You Know the Answer?: Economic Hardship Q&A

Q. Can borrowers still be granted an Economic Hardship Deferment (HRD) if they apply after June 30, 2009 but indicate the qualifying condition began before July 1, 2009?

A. Yes. Lenders are permitted to grant HRD based on the ‘20/220’ criterion or ‘working less than full time’ criterion if a borrower applies after July 1, 2009, provided the borrower is eligible for the deferment and the qualifying condition began prior to July 1, 2009. However, in order to qualify for deferment, a borrower’s loans must be in repayment.