Loan forbearance does not usually mean interest free. Usually it means that interest continues to accrue but payments are postponed. The interest is capitalized and added to your balance.
Be sure to read any paper work to make sure you understand exactly what is being offered.
Many of the mortgage forbearance programs default to a ballon payment at the end of the postponement period. Other options are often available if you ask.
A deferment usually means no payments and no interest.
In this case they really do mean no interest for the time period. You will still owe the principle balance regardless so not making any payments during the forbearance time period will lengthen the loan period.
Here's the info from my loan servicer:
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We've taken the following actions on the federally owned loans we service for you:
• 0% Interest Rate - We changed the interest rate on the loans to 0% for the period March 13, 2020, through Sept. 30, 2020. During this period, you will not be charged interest on your loans.
• Administrative Forbearance - We placed the loans identified in an administrative forbearance for the period March 13, 2020, through Sept. 30, 2020. During this period, you will not be required to make monthly payments on your loans. If your payments are made through auto debit, those debits will not occur while the forbearance is in place. We will report you as current to credit reporting agencies.
Although you will not be required to make monthly payments during this specific administrative forbearance period, payments you would have been required to make between March 13, 2020, and Sept. 30, 2020, will count toward loan forgiveness provided all other qualifying factors are met.
Note: If you choose to make payments during the administrative forbearance period, you may do so; however, you'll need to make those payments manually (not through auto debit). Given the 0% interest rate explained above, any payments you make during the March 13, 2020, through Sept. 30, 2020, period will be applied to paying down the principal amount of your loans after accrued interest from other periods has been resolved.
WHAT YOU NEED TO DO
Keep this notification for your records. We'll communicate with you in August to help prepare you for Sept. 30, 2020, when the 0% interest rate and administrative forbearance period ends.
There's no other action you need to take,
unless you want to opt out of the administrative forbearance we've placed on your account. If you opt out, we'll remove the administrative forbearance and you'll be required to make monthly payments. Unless you want to continue making payments through auto debit, there is no advantage to you by opting out of the administrative forbearance. The 0% interest rate will remain in effect, and you will not be charged interest through Sept. 30, 2020, whether the forbearance remains in effect or not.
To opt out, let us know through one of the options described below in the section, "HOW TO CONTACT US."
• If you change your mind after opting out, you can simply request that your loans be placed in the administrative forbearance again. Contact us through one of the options described below in the section, "HOW TO CONTACT US."
• If you opt out and become more than 30 days late in making a required monthly payment, we'll place your loans in the administrative forbearance again."
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This aspect of the communication is key: "Given the 0% interest rate explained above, any payments you make during the March 13, 2020, through Sept. 30, 2020, period will be applied to paying down the principal amount of your loans after accrued interest from other periods has been resolved." When they say "other periods" they are meaning any interest outside of the March 13th-September 30th time period.
To make it a tad clearer here's the answer from the FAQs set up for the coronavirus and Federal Student Loans in general (so not specific to a particular servicer):
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UPDATED: What if I want to continue making payments?
If you wish to continue paying your loans during the administrative forbearance period, or to pay more or less than your regular payment amount, you are free to do so. Contact your loan servicer or visit your servicer’s website to make a payment or to find out how you can continue or start auto-debit payments.
Continuing to make payments during the administrative forbearance could help you pay down your loan balance more quickly because the full amount of a payment will be applied to principal once all interest accrued prior to March 13, 2020, is paid.
The underlined is discussing the period being spoken about.
For example my payment that would have been drafted on April 13th was for a time period of 02/19/20 to 03/18/20. So for me my April 13th payment would have included accrued interest from 02/19/20 to 03/12/20. I made an additional payment like normal and that accrued interest is already taken care of now.