Need to Skip a Car Payment? Deferral Options Explained

If an unexpected financial emergency has left you short on funds, you might be wondering, "Can I defer my car payment?" The good news is that many lenders do allow borrowers to defer a car payment when necessary. While this option can help you avoid late fees or repossession, it's important to understand how deferment works and whether it's the right choice for your situation. Our finance experts at Flower Motor Company near Ridgway explain everything you need to know about auto loan deferment below.

What Does It Mean to Defer a Car Payment?

A car loan deferment allows you to temporarily pause a scheduled payment and move it to the end of your loan term. This can help you avoid missing a payment and damaging your credit, but it must always be approved by your lender. Some auto loans even include built-in deferment policies, while others require case-by-case approval.

👉 Key things to know about deferments:

• Deferment doesn't erase your payment-it delays it.
• Your lender may still charge interest during the deferment period.
• You must contact your lender directly-deferring without approval isn't an option.

How Many Times Can You Defer a Car Payment?

Every lender has different deferment policies. Some may allow only one deferment during the life of your loan, while others may permit two or more. In some cases, lenders restrict deferments per year, while others limit the total across your entire loan term. Because policies vary widely, the best step is to contact your lender as soon as you know you'll need help.

Is Deferring a Car Payment the Right Choice?

While deferment can provide breathing room, it's not the right move for everyone. Before you proceed, ask yourself if there are alternatives-such as temporary help from family, selling a vehicle you have equity in, or refinancing your loan. Here are the pros and cons of auto loan deferment:

Advantages of Car Loan Deferment

• Protects you from repossession, which can severely damage your credit.
• Helps you avoid costly late fees.
• Buys time to refinance your loan or sell your car if needed.
• Provides short-term financial relief during an emergency.

Disadvantages of Car Loan Deferment

• The payment isn't waived-it's added to the end of your loan.
• Many lenders still require you to pay interest during the deferment month.
• Interest continues to accrue, which may increase the total cost of your loan.

Get Auto Loan Guidance from Flower Motor Company

Still have questions about deferring a car payment or managing your auto loan? Our team at Flower Motor Company near Ridgway and Delta is here to help. Contact our finance experts or visit us in person for personalized guidance. You can also explore our finance and insurance research hub for more answers to common questions, like "What are the top ways to increase your car's trade-in value?"