what is admin forbearance nelnet

Admin forbearance is a period during which payments to federally held student loans have been automatically paused or suspended and interest rates set to 0% . Nelnet, a major student loan servicer, applies an administrative forbearance to student loan accounts for the month of September 2023 to provide all borrowers with a standard amount of time to prepare to transition into repayment. During forbearance, no payments are due, but interest will accrue on the loan balance and will show as outstanding accrued interest. This accrued interest will not capitalize, meaning it will not be added to the principal balance once the forbearance ends, but it will still be required to be paid. Borrowers can opt-out of this administrative forbearance and begin payments in September rather than October by notifying their loan servicer by August 31. Administrative forbearances can be granted for up to 12 months at a time, and borrowers may want to opt-out of the forbearance because of interest accrual.