Hi Heather,

If a borrower who is enrolled in IBR enters voluntary forbearance, and makes reduced payments, will these payments count towards the 25 year forgiveness? I believe entering into an “economic hardship deferment” counts (Periods on or after July 1, 2009, when the borrower has been granted an economic hardship deferment). What about other types of deferments or forbearance?

Thanks,
Jon

This is a tough one, Jon.  I’m not sure, but it seems like yes.  Here’s what the regs say that seems applicable:

(f) Loan forgiveness. (1) To qualify for loan forgiveness after 25 years, a borrower must have participated in the income-based repayment plan and satisfied at least one of the following conditions during that period:
...
(ii) Made reduced monthly payments after the borrower no longer had a partial financial hardship or stopped making income-based payments as provided in paragraph (d) of this section.
...

Let me ask a few other folks for their opinions on this one and see what other’s think.