Loan Deferment Calculator
Interest grows during deferment.
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How to use
Deferment pauses your payments, but on most loans the interest keeps accruing and gets added to the balance — capitalized. This calculator shows the new balance after the deferment period so you know what pausing actually costs.
How to use
- Enter your current balance, APR and the number of months you plan to defer.
- Press Calculate to see the balance after deferment and the interest added.
Example
A $12,000 balance at 5% deferred for 12 months grows to about $12,614 — roughly $614 of interest added to principal. That new, higher balance then accrues interest for the rest of the loan, so the real cost compounds.
Formula
Balance after = balance × (1 + monthly rate)^months. The interest capitalizes into the balance, so you pay interest on interest later.
Subsidized loans differ
Some subsidized student loans pause interest during deferment — the government pays it. This calculator assumes interest accrues, which is the correct model for unsubsidized and private loans, and for most auto deferrals.
The cost of pausing
Deferring is sometimes the only option, but the numbers above show the price. On a 60-month $12,000 loan, a 12-month deferral adds hundreds to the total — often worth avoiding if you can pay even a reduced amount.
Deferral vs forbearance
Deferment and forbearance both pause payments, but the details differ by loan type. On federal student loans, subsidized deferment can pause interest entirely; forbearance always accrues it. Auto lenders offer hardship deferrals where interest continues regardless. Whatever the label, the math in this tool — the balance growing at the monthly rate — applies whenever interest is not paid during the pause.
FAQ
Does interest always accrue during deferment?
On unsubsidized and private loans, yes. Some subsidized federal loans pause interest — check your loan type.
Why does the balance jump so much?
The interest for the whole pause is added to principal at once, and that larger balance accrues going forward.
Should I pay interest during deferment?
If you can cover just the interest each month, the balance stays flat and the total cost stays far lower.
Is this the same as forbearance?
Similar idea — paused payments with accruing interest. Forbearance details vary by lender.
Reviewed by the LoanMath editorial team