Pressing Pause: A Friendly Guide to Knowing When Loan Forbearance Makes Sense

 Life doesn’t always go according to plan—and sometimes, that includes your ability to keep up with loan payments. Whether due to job loss, medical emergencies, or other financial setbacks, loan forbearance can offer temporary relief. But when is the right time to consider it?

Loan forbearance allows you to temporarily pause or reduce your loan payments without going into default. It’s typically used as a short-term solution during times of hardship and is available for various types of loans, including federal student loans, mortgages, and some private loans.

You might want to consider forbearance if you’re facing a sudden loss of income, dealing with large medical bills, or recovering from a natural disaster. It can provide breathing room while you get back on your feet. However, it’s important to understand that interest may continue to accrue during the forbearance period, potentially increasing your total repayment amount.

Before applying, explore all your options. Could you adjust your budget or negotiate a new payment plan with your lender? Are there income-driven repayment options available, especially for student loans? Forbearance should be seen as a last resort, not a long-term fix.

If you decide to move forward, contact your lender or loan servicer promptly. Ask questions, understand the terms, and get everything in writing. Keep track of when the forbearance ends so you can resume payments without surprise.

In summary, loan forbearance can be a helpful tool when used wisely and temporarily. Knowing when and how to use it can protect your credit and give you the financial relief you need—just when you need it most.