How to Defer a Car Payment

by Mary Yamin-Garone

Today’s troubled economy has forced many Americans to tighten their belts and “cut the fat” to weather the financial storm. For some people, that means deferring or postponing their car payments. While doing so can provide a brief respite, unfortunately not everyone is able to defer on their loan. The lender and the terms of the loan agreement determine eligibility. Here are some guidelines to follow if you need to defer your car payment.

Step 1

Understand what it means to defer your car payment. You still will be responsible for the full amount of your loan. Approved deferral applicants are, however, granted a grace period before they are required to resume making payments.

Step 2

Contact your financing company or lending institution and explain your financial situation.

Step 3

Ask if the terms of your car loan or leasing agreement will allow you to defer your car payments until you get back on your feet. Be ready to provide documentation verifying your employment status if you are unemployed.

Step 4

Complete the necessary paperwork for deferring your car payments. Send the signed documents and any required fees to the loan company. Keep a copy for your records.

Step 5

Ask your loan officer to draw up a forbearance agreement. This document recognizes your financial hardship and offers a plan to resolve it. Most forbearance agreements establish a payment schedule for satisfying the debt.

Step 6

Verify the conditions of your forbearance agreement with your lender. Find out how many payments will be deferred, if there is a charge to defer payments, when the payments are due, what the repayment schedule is for missed payments, and if your lender can stave off negative credit reporting while your payments are deferred.

Step 7

Check to see if any already imposed fees can be retracted and if your car payment can be deferred without other negative credit consequences, such as late fees and collection calls.

Step 8

Request that any promises made by your loan service be put in writing. Read over all information before signing any documents. Only sign the paperwork when you fully understand the terms of your agreement and how they affect your ability to pay off your loan.


  • Free legal assistance is available for low-income individuals. Check your local telephone directory or call your state’s Bar Association’s Legal Assistance Hotline for more information.


  • Read the fine print. In some cases, only the car payment is deferred, not the interest.

About the Author

Mary Yamin-Garone has been a freelance writer since 1980. Specializing in health, fitness and senior care, her work is featured on and She received the 2002 APEX Award for Publication Excellence for Magazine and Newspaper Writing. She holds a Bachelor of Arts in English and journalism from Albany State University.

Cite this Article A tool to create a citation to reference this article Cite this Article