Homeowner finances may be in peril due to COVID-19, many are in search of mortgage relief. Two options that many borrowers are considering right now are mortgage deferment and mortgage forbearance.

Both tactics allow a borrower to skip monthly payments for a set period. Depending on the lender, there can be subtle differences between the two terms.


Both tactics allow a temporary period during which a borrower need not make contractual monthly payments. The differences between the two options come at the end of that period.

Forbearance- may allow 3 months or more worth of mortgage payments (depending on the lender) to go unpaid but at the end of the forbearance period;the amount of payments that you missed during that forbearance will be due in a lump sum. Lenders will work with borrowers to structure a payment plan, instead of demanding a lump sum by doing a loan modification of some type. 

Note: May be reported to credit bureaus and could negatively impact credit scores

Deferment— in most cases and more likely during the pandemic will allow customers to repay the money over time or to add it to the end of the loan period.

Note: No negative impact to credit or late charges but interest on the loan will still accrue. 

It’s really important to only utilize either option if it is absolutely necessary. Contact your lender to determine what options are available for your loan type. 



This content is not the product of the National Association of REALTORS®, and may not reflect NAR's viewpoint or position on these topics and NAR does not verify the accuracy of the content.