Final answer:
Death Verification Forbearance is a temporary period allowing postponement of student loan payments while the lender verifies the death of the co-signer or student beneficiary. Federal student loans may be discharged upon death by submitting the death certificate. The duration of the forbearance varies by lender and loan type.
Step-by-step explanation:
The Death Verification Forbearance is a period granted to borrowers of student loans in the event that the loan's co-signer or the student beneficiary has passed away. This forbearance allows for a temporary postponement of payments on the loan while the lender verifies the death and processes the next steps. During this time, interest may continue to accrue, but no payments are required until the conclusion of the forbearance period.
For federal student loans in the United States, there is a discharge benefit, which means that the loan may be discharged if the borrower or the student for whom the parent borrowed dies. The executor or family member of the deceased will need to provide a copy of the death certificate to the loan servicer. The specific length of the forbearance period may vary depending on the lender's policy and the type of loan.
It is important for those dealing with such circumstances to contact the loan servicer as soon as possible to understand the available options and to ensure that they comply with the required procedures. The exact details can vary by lender, so one should review their loan agreement for more information on the terms of Death Verification Forbearance.