Updated on July 27, 2021
Are you currently facing financial hardship? Or are you worried about a possible job loss in your future? In either case, it’s important to reach out to anyone you may be financially indebted to in order to discuss your particular situation and the impact on your ability to repay them.
Your lender may modify the terms of your loan to reduce the interest rate, extend the current maturity term, offer a different loan type, or offer any combination of these. If you anticipate a conversation with your lender about a loan modification, get familiar with terms you might hear during your discussion.
It’s important to consult your budget (or make one if you don’t have one in place) when considering major financial decisions. If you know that you’re going to have trouble making payments, contact your lenders as soon as possible.
When you’re able to talk with someone, explain your situation and let them describe the options they can offer. You may be dealing with several lenders, so be prepared to take notes during each conversation. Keep any documentation you receive about arrangements you’ve worked out in a safe place, and continue making payments until you receive official confirmation regarding when the program takes effect.
If you do secure an arrangement that allows you to delay loan payments, you’ll want to keep a close eye on your credit report. To do so, visit www.AnnualCreditReport.com.
Remember, even if you’re delaying payments on a debt, you’re responsible for tracking and repaying what you owe. While you have a respite from monthly payments, continue to look for ways to save money or make extra cash. And for more money management tips, visit our WalletWorks page.