How to Defer Loans

Deferring a loan means the lender will postpone payment collection for a period of time. Because each loan and lender is different, deferments can range from a few months to up to five years. During the deferment period, interest is usually chargedexcept in the case of subsidized loans (such as student loans).

To qualify for a loan deferment, the borrower must meet specific criteria such as military obligations, hardship circumstances or unemployment.

Instructions

1

Request a hardship deferment. If you have a medical or psychiatric condition considered a disability with which you can no longer work, you may qualify for a hardship deferment of the loan. Each lender will have different requirements, but in general you must be able to provide documentation of your disability.

2

Or, request a forbearance agreement. A forbearance agreement is an agreement granted by the lender to the borrower to place loan payments on hold for a brief period of time, usually for less than six months. The forbearance agreement typically requires the borrower to be unemployed and demonstrate with documentation (such as an unemployment benefit claim) that he cannot repay the loan.

3

Or, cancel your loan. In some circumstances, you may be able to outright cancel your loan. As with a hardship deferment, qualifications may require the borrower be partially or totally disabled, be deceased or be unemployed. There are other qualifiers such as economic hardship or being the victim of identity theft.

4

Or, file for bankruptcy protection. Individuals with multiple loans and/or lines of credit they simply cannot repay may elect to file for federal bankruptcy protection. During bankruptcy, the borrowers loans and lines of credit are discharged and she no longer owes them. The exception are student loans--bankruptcy often does not discharge them, but defers them temporarily.