Forbearance

Forbearance refers to the act of refraining from enforcing a right, obligation, or debt. It often involves a temporary delay or susPension of action, particularly in a legal or financial context.

Forbearance is commonly seen in loan agreements, where a lender may agree to postpone a borrower’s payments due to financial hardship. This can help the borrower avoid default and provide them with time to stabilize their finances.

Examples:

• A mortgage lender allows a homeowner to pause payments for six months during a period of unemployment.
• A Credit card company agrees not to pursue collection actions for a customer facing medical bills.

Cases:

• In United States v. Hodge, the court acknowledged forbearance in loan repayment due to extenuating circumstances.
• In a consumer Bankruptcy case, the judge may grant forbearance on certain debts while the debtor reorganizes their finances.