What Is Personal Loan Deferment and How Does It Work?
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If thinking about paying your monthly bills keeps you up at night, you’re not alone. An unexpected emergency, a sudden job loss, or other economic hardship can kick your stress into high gear. Fortunately, you have options that can help ease your mind.
For example, if one of your bills is a personal loan payment, some lenders may allow a temporary deferment until you get back on your feet.
Find out about personal loan deferment, how it works, its drawbacks, and if it’s right for you:
What is personal loan deferment?
Loan deferment allows you to pause your monthly personal loan payments temporarily. Your lender will need to approve deferment for your loan, and it’s usually reserved for people experiencing some sort of financial hardship, such as a job loss, major unexpected expense, or national emergency.
In order to get a personal loan deferment, you’ll need to speak with your lender to explain your individual situation to see if you might be eligible.
Not all lenders are required to offer personal loan deferment, but many are willing to work with you if you’re struggling to make your loan payments.
If you’re having trouble keeping up with your loan payments but deferment isn’t an option, you might be able to refinance your personal loan and get a lower interest rate, longer repayment term, or both. Credible makes it easy to see your prequalified personal loan rates from multiple lenders in minutes.
The personal loan companies in the table below compete for your business through Credible. You can request rates from all of these partner lenders by filling out just one form (instead of one form for each) and without affecting your credit score.
| Lender | Fixed rates | Loan amounts |
|---|---|---|
 Credible Rating  Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
9.95% – 35.99% APR | $2,000 to $35,000** |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
6.79% – 17.99% APR | $10,000 to $50,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
4.99% – 35.99% APR | $5,000 to $50,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
5.99% – 24.99% APR | $2,500 to $35,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
7.99% – 29.99% APR | $7,500 to $50,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
7.04% – 35.89% APR | $1,000 to $40,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
7.99% – 35.99% APR | $2,000 to $36,500 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
3.49% – 19.99% APR | $5,000 to $100,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
6.99% – 19.99% APR1 | $3,500 to $40,0002 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
18.0% – 35.99% APR | $1,500 to $20,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
5.99% – 24.99% APR | $5,000 to $40,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
4.99% – 17.99% APR | $600 to $50,000 (depending on loan term) |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
7.95% – 35.99% APR | $2,000 to $40,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
6.99% – 21.78% APR10 | $5,000 to $100,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
8.93% – 35.93% APR7 | $1,000 to $20,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
5.94% – 35.97% APR | $1,000 to $50,000 |
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 Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. |
4.37% – 35.99% APR4 | $1,000 to $50,0005 |
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| Compare rates from these lenders without affecting your credit score. 100% free!Compare Now |
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| All APRs reflect autopay and loyalty discounts where available | LightStream disclosure | 10SoFi Disclosures | Read more about Rates and Terms | ||
How does personal loan deferment work?
When you defer a payment on your personal loan, you’re essentially putting off your recurring payment until a later date, which can be anywhere from one month to several months, depending on the lender.
If your lender approves deferment for your loan, ask if it charges any fees for the deferral. Make sure you understand the exact terms of the deferment and when your payments will resume, so that you can plan ahead.
If you’re worried that you still won’t be able to make your loan payments as the end of your deferment period nears, you might be able to request another deferment from your lender. Some personal loan lenders limit how many times a borrower can request loan deferment, and they may decide to extend (or not extend) the deferral period depending on your individual circumstances.
Learn more: What Is a Personal Loan Origination Fee?
Will interest accrue on the loan during deferment?
Yes, interest will accrue on your personal loan during deferment. While you’ll get a temporary break from making your monthly payment, you’ll still accrue interest on your loan, which you’ll need to pay back when your loan payments resume. Unfortunately, by pausing payments, your total loan balance will grow as interest keeps accruing, which means you’ll have more debt to pay off in the long run.
In some special cases, like the coronavirus pandemic or a natural disaster, your lender might temporarily pause interest as well, so it’s best to check with your lender to see what payment relief options it might offer.
Learn more: COVID 19: How Personal Loan Lenders Are Helping Borrowers
Will deferring a personal loan hurt your credit score?
If your lender agrees to personal loan deferment, your credit shouldn’t suffer. Lenders typically report payments to the credit bureaus each month. But if you’ve chosen to defer your personal loan payments, the lender will report it as deferred and not late or missed, and your credit won’t take a hit.
However, when your deferment ends, you’ll be required to resume payments as laid out in the terms of your loan. If you’re late or miss a payment, you’ll likely have to pay a late fee, and your credit and credit score can suffer.
You can compare personal loan rates on Credible. It only takes a few minutes, and it won’t affect your credit score.
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Personal loan deferment alternatives
Personal loan deferment is a temporary option, and it’s not meant to be a long-term solution for managing your debt. If you need an alternative that works for a prolonged period or you can’t get a deferment, you have other options to consider:
- Refinance the loan. Refinancing your personal loan may help you lower your monthly payments by extending your repayment term. If your credit has improved since you took out your original loan, refinancing may even come with a lower annual percentage rate, or APR. A lower interest rate can also help you save money over the life of the loan. But to qualify for the lowest rates, you’ll likely need good to excellent credit and a low debt-to-income ratio.
- Ask your lender about a modified payment plan. If you’re unable to make payments as spelled out in your original loan agreement, your lender may suggest a loan modification plan. Under this payment plan, your lender may reduce the interest rate, extend the repayment term, or you may qualify for a different type of loan altogether. Keep in mind that you’ll pay more in interest over time by extending the payoff period, but your payments may be easier to manage from month to month.
- Speak with a debt counselor. If you’re having trouble making payments on your personal loan, you might consider speaking with a debt counselor from a credit counseling organization. A credit counselor can advise you on managing your money, consolidating your debt, and direct you to helpful resources. Likewise, if you’ve been the victim of a predatory lender, a debt counselor can provide information on how to take further action and how to contact the Consumer Financial Protection Bureau to file a complaint.
Learn more: 17 Best Personal Loan Companies
If you do decide to refinance your existing personal loan rather than defer payments, remember that it’s a good idea only to borrow what you can afford. Our personal loan calculator below can help you estimate what your monthly payments might be, as well as the total cost of your loan.
Enter your loan information to calculate how much you could pay
With a $ loan, you will pay $ monthly and a total of $ in interest over the life of your loan. You will pay a total of $ over the life of the loan.
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