Has the unpredictability of life made it challenging for you to pay off your personal loan EMIs? Do not be discouraged! Overwhelming as it may seem, there are other options to help you deal with such a situation. So, instead of defaulting on your payments, ask your lender for a personal loan deferment.
What is personal loan deferment?
In a nutshell, deferment is defined as the action of putting something off to a later time. In the context of personal finance, a deferment is a pre-agreed, temporary break from making loan repayments.
Loan deferments are typically reserved for people going through some sort of financial hardship, for instance, medical emergency, national emergency, loss of a job, etc. To get a loan deferment, you need to speak to your lender and clearly explain your situation.
How does personal finance deferment work?
Suppose your lender agrees to offer a deferment on your personal loan or credit. Following this, the EMI you needed to pay in October 2021 will be paid in November 2021.
Further, if a lender agrees to offer deferment, it is critical to understand their specifications or rules to do so. For example, you need to know exactly when your loan deferment officially starts and when it ends.
Lenders usually offer deferments in one-month intervals, but the time period may be extended. Say, your next payment is due on November 1st, and your deferment starts from November 2nd; you will still need to make a payment for the month of November.
Again, suppose you find yourself unable to make an EMI payment even at the end of your pre-approved deferment period. In that case, you need to contact your lender once again, requesting for another deferment. If your lender offers personal finance deferment in one-month intervals, this needs to be done every month until you are able to pay off your loan EMI. However, do remember that most lenders will have a limit to the number of deferments that they allow.
Additional Read: Ways to Plan Personal Loan EMI Repayment Smartly
Does loan deferment affect your credit score?
If the lender has approved a loan deferment, then your credit score will remain unaffected. Normally, lenders need to report to credit bureaus whether your loan EMIs have been paid on time, paid late, or defaulted. Normally, paying late or defaulting on loan repayments will harm your credit report. However, the same should not be the case due to deferment, as the lender will simply report it as a ‘loan deferment’.
Additional Read: How much CIBIL Score Required for Personal Loan
Before you opt for personal finance, be sure to check your repayment capacity using a personal loan EMI calculator and plan your loan in advance.
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With us, you can avail personal finance up to Rs. 25 lakhs. So, what are you waiting for? Check your personal loan eligibility with us and fund your needs today!