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Deferment Period
A specified time during which loan payments are temporarily suspended or reduced.
More Details
A deferment period is a period of time during which a borrower is not required to make payments on a loan. Deferment is often granted to borrowers who are experiencing financial hardship, such as unemployment, economic hardship, military service, or returning to school.
Example
If you experience financial hardship as a result of a pandemic, you may be able to secure a deferment on student loan payments. Once the deferment period is approved, you can stop making payments for the approved amount of time. Payments will resume after this period ends.
Related Terms
APY
APY, or annual percentage yield, is the rate of dividends earned on a credit union account over a year, taking into account the effect of compounding.
Refinance
The process of paying off an existing loan with a new loan, typically in order to obtain a lower interest rate or to change the terms of the loan.
Lender
A financial institution or individual that provides money to a borrower with the expectation of being repaid, often with interest.

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