Deferment and forbearance cost calculator

How this calculator works

This calculator simulates two paths for the same loan: continuing payments on schedule versus pausing for a set number of months. It uses standard fixed-rate amortization for the baseline path, recording total interest paid and months to payoff. For the pause path, it accrues monthly interest during the pause (unless you select subsidized deferment with no accrual), optionally capitalizes that interest into principal when payments resume, recalculates the monthly payment on the new balance, and runs the amortization schedule to completion.

The difference between total paid on each path is your extra lifetime cost. Payoff delay compares how many months each simulation takes to reach zero balance. A balance chart plots both paths month by month so you can see the gap visually — the pause line stays flat while payments stop, then may jump upward if interest capitalizes before resuming its decline.

What affects the result

Balance and interest rate set how fast interest accrues during the pause — a $40,000 balance at 7% accrues far more than $15,000 at 4%. Pause length multiplies that monthly accrual; a 12-month forbearance costs roughly twice a 6-month pause. Whether interest accrues at all is the biggest binary switch: subsidized deferment with government-paid interest adds zero to your balance.

Capitalization determines whether accrued interest becomes part of your principal. When it capitalizes, your monthly payment rises and you pay interest on interest for the remaining term. When it does not capitalize, you still owe the accrued amount, but your payment stays based on the original principal — this calculator counts that separately in lifetime cost. Remaining term after the pause affects how long you carry any extra balance forward.

Real-world examples

Example 1 — Six-month forbearance with capitalization: Tyler has $28,000 at 6.53% with eight years remaining. A six-month forbearance accrues about $915 in interest that capitalizes into principal, raising his payment by roughly $12 per month and adding over $1,000 in lifetime cost.

Example 2 — Subsidized deferment: Sandra returns to school half-time on subsidized federal loans. Interest does not accrue during in-school deferment. Her balance stays at $12,000 and her payment after deferment is unchanged — she only delays payoff by the deferment months with no extra interest cost.

Example 3 — Long forbearance on PLUS loans: Marcus pauses his Parent PLUS loan for 12 months at 8.05%. Interest always accrues and typically capitalizes, adding over $2,400 to principal and pushing payoff out by more than a year. This is why PLUS borrowers are steered toward IDR before forbearance.

Example 4 — Accrual without capitalization: A borrower negotiates forbearance where accrued interest is billed separately rather than added to principal. The balance at resume stays at $20,000, but the $800 accrued during the pause still adds to lifetime cost — just without raising the monthly payment.

Example 5 — IDR alternative: Before accepting 12-month forbearance on $32,000 at 6.53%, a borrower models a $0 SAVE payment instead. The deferment calculator shows forbearance adds roughly $2,100 in capitalized interest; IDR may avoid that cost while preserving forgiveness eligibility — compare both paths in the plan comparison tool.

Example 6 — Short three-month pause: A borrower between jobs requests three months of general forbearance. Even a short pause on a $45,000 balance at 7.2% accrues roughly $810 in interest — useful context when negotiating a return-to-payment date with the servicer.

Common mistakes

• Choosing forbearance before checking IDR. A $0 IDR payment preserves forgiveness progress and avoids capitalization. Forbearance months generally count toward nothing.
• Assuming subsidized rules apply to all loans. Only subsidized federal loans in eligible deferment get government-paid interest. Unsubsidized and private loans always accrue.
• Ignoring capitalization. Many borrowers focus on the pause length but miss that capitalized interest permanently raises payments. Toggle capitalization in this calculator to see the difference.
• Pausing without a re-entry plan. Forbearance is limited and temporary. Use this calculator to set a target end date and budget for the higher payment or extra balance that follows.
• Missing the PSLF impact. Forbearance and most deferment months do not count toward the 120 qualifying PSLF payments. IDR payments do — even at $0.
• Stopping payments without contacting the servicer. An unauthorized pause leads to delinquency and default. Always request an official deferment or forbearance through your servicer.

When to use this calculator

Use this tool before requesting any payment pause — deferment, forbearance, or administrative forbearance while an IDR application processes. It translates "just six months" into real dollars and shows whether the pause is worth it compared to switching to an income-driven plan.

It is also useful when comparing subsidized deferment (returning to school, unemployment, economic hardship) against general forbearance, or when a servicer offers a pause as the default option and you want numbers before accepting. Run it again after any pause ends to see how capitalization changed your payment. The can't pay guide walks through when IDR may be preferable to a pause.

Limitations

This models a single loan with one pause period — not a multi-loan portfolio with different subsidized and unsubsidized behavior simultaneously. IDR $0 payments and forgiveness progress are not compared numerically here; use the plan comparison calculator for that. Servicer-specific capitalization timing may differ. Private loan hardship terms vary by lender and are not standardized. PSLF credit during administrative forbearance depends on individual circumstances not captured in this simulation.

Sources

1. Federal Student Aid — Get temporary relief
2. Federal Student Aid — Repayment plans
3. Federal Student Aid — Subsidized and unsubsidized loans
4. Federal Student Aid — Public Service Loan Forgiveness