So my sister is kinda flaky and not great with her bills no matter how many times i organize and budget them for her.
She was seriously injured in 06 accident by drunk driver, i fly to AZ to care for her and thats my 1st attempt at straightening her out (2 student loans owing over 40 grand) credit cards with ridiculous limits for her income - had her close a few b/c she just uses them and the PIF concept is lost on her.
Fast Forward - she has a baby moves back home by family. Left her full time full teacher job in AZ to come to NY and not be liscensed here so she is only like a teachers aide (also something about her credits wont transfer from having 2 months left on her masters in AZ)
So way less income, bills still the same, baby to care for.
When i got another look at her loans (student) I notice she is way way past 200 days so i say, i dont know much but there is a magic number when they will default you, garnish wages etc...
So get her info together and start calling Citi and Nelnet.
Citi immediatly forebearanced her , but since she was almost a year behind that didnt do a whole lot except help her breathe. (stafford unsub forebearance from 12/12/07-12/11/08 unsub stafford forebearance from 1/17/08-1/16/09)
Just received the application to also do deferment - "Economic Hardship Deferment" (which im not sure if thats a great option but may be her only option)
NelNet had already started default so i had to pay to bring her to 220 days, and in the meantime we need to let that clear then call back and ask for either forebearance or deferment.
So, Im not really sure what to do from here.
She has 2 loans with each, i think total in regular monthly payments to NelNet is $85 and $120 to Citi.
When talking to Nelnet he was saying things i didnt really understand about interest still accruing, end of forebearance interest becomes due?? Does that mean a large lump sum will be due along with her starting to make regular payments again??
I really did my best to read thru the posties about this, but got very lost.
Any advice would be much appreciated!!!!!!!!

The interest won't really come due at the end of the forbearance, it will be capitalized which means it will be added onto the principal. Basically, once that happens, she'll eventually pay interest on the interest that accrued during the forbearance. A little confusing, I know.

Please understand that the retroactive forbearance will not affect how the loans are reported to the credit bureaus. All of the lates will continue to appear on your sister's credit report. Don't get me wrong, you did the right thing by preventing default, but I've hung out around here long enough to see countless people post a couple years after a retroactive forbearance asking why the lender is reporting "inaccurate" lates.

TY Saria, While its important to fix her credit report also, i felt the default was top priority and lets face it, she really is that late and she deserves the consequence. I pulled her Fakos and they were bad, she keeps telling me but i was 600 something a few months ago (as though she thinks 600 is the bees knees!) when i got my new car - yeah well that was then this is now. Her fakos were like 550 or less so i know her real scores are bad. She currently couldnt buy a house if she wanted to and needs no more credit cards. At least what we saw on her reports appeared accurate. Its just that the report wasnt my main concern with her, getting her bills paid and a good budget was/is my priority. Oh yeah and not having her wages or tax return garnished another #1!
Also I had asked about making additional interest or principal payments, they said student loans dont work that way. Is that true?