What Is Credit Card Forbearance?

Credit card forbearance is a short-term arrangement that some card issuers offer to borrowers experiencing financial hardship. It may allow you to pause payments, reduce monthly obligations or receive other forms of assistance for a limited period. However, forbearance doesn't eliminate your debt, and you'll still need to repay what you owe.

When your income suddenly drops, or an unexpected expense throws your budget off track, keeping up with credit card payments can feel overwhelming. If you're struggling to make your minimum payments, credit card forbearance may offer temporary relief. But before you apply, it's important to understand how it works and what it can and can't do.

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Key Takeaways

• What is credit card forbearance: It's a temporary arrangement some card issuers offer borrowers in financial hardship that may pause payments, reduce minimums, lower your APR or waive certain fees for a set period.

• It's relief, not forgiveness: Forbearance doesn't erase your balance — you're still responsible for repaying the full amount you owe once the relief period ends.

• Interest usually keeps adding up: Many programs continue charging interest while payments are paused or reduced, so your balance can grow even while you're enrolled.

• You have to ask, and approval isn't guaranteed: Hardship programs aren't widely advertised, so contact your issuer directly, expect to document your hardship and know that issuers review each request case by case.

• Relief is short-term: Programs typically run from a few months up to about a year, making forbearance best suited to a temporary setback you expect to recover from.

• Protect your credit along the way: Following the agreement generally helps you avoid late-payment damage, but higher balances can raise your credit utilization ratio and may indirectly affect your score, so monitor your reports.

Summary generated by AI, verified by MoneyLion editors

Credit Card Forbearance at a Glance

Credit card forbearance is a temporary payment relief program offered by some credit card issuers to customers facing financial difficulties. Depending on the issuer and your situation, the arrangement may allow you to skip payments, make reduced payments, receive a lower annual percentage rate (APR) or avoid certain credit card fees for a set period.

The key thing to remember is that forbearance is not debt forgiveness. The balance on your credit card doesn't disappear, and you'll generally still be responsible for repaying the full amount you owe once the relief period ends. Because terms vary widely by issuer, it's important to understand the details before enrolling.

How Credit Card Forbearance Works

If you're experiencing financial hardship, the first step is usually to contact your credit card issuer directly and ask about hardship assistance or forbearance options. Each issuer has its own policies, eligibility requirements and relief programs.

The issuer will typically review your request on a case-by-case basis. You may be asked to provide documentation showing your hardship, such as proof of job loss, reduced income, medical expenses, or other financial challenges.

If approved, you'll receive a temporary modified payment arrangement. Depending on the program, relief may last anywhere from a few months to a year. Once the forbearance period ends, regular payments generally resume, although the exact repayment terms will depend on your agreement.

What Relief a Forbearance Program May Offer

Not all credit card issuers offer the same type of relief, but common forms of assistance include:

• Paused monthly payments for a limited period

• Reduced minimum monthly payments

• Lower interest rates or temporary interest relief

• Waived late fees or other account fees

• Temporary suspension of collection activity

Because programs differ by issuer, borrowers should carefully review the terms before agreeing to any hardship plan.

Who May Qualify for Credit Card Forbearance

Borrowers experiencing legitimate short-term financial hardship may qualify for credit card hardship assistance. Common situations include:

• Job loss or unemployment

• Reduced work hours or income

• Serious illness or injury

• Divorce or separation

• Death of a family member

• Major unexpected expenses

Issuers may also consider your payment history when reviewing an application. Customers who have consistently made payments before their hardship occurred may have a better chance of receiving assistance. However, approval is never guaranteed, even when the hardship is genuine.

Pros and Cons of Credit Card Forbearance

Like most financial relief programs, credit card forbearance has advantages and drawbacks.

Pros

• Provides breathing room during a temporary financial setback

• May help prevent missed payments and late fees

• Can help avoid penalty APRs and collection activity

• Frees up cash flow for essential expenses such as housing, food and medical care

• Gives borrowers time to stabilize their finances

Cons

• Interest may continue to accrue during the relief period

• The balance may grow even while payments are paused

• The debt is not forgiven and must still be repaid

• Payments may become difficult again when the program ends

• Higher balances can increase credit utilization and potentially affect credit scores

Forbearance is often most effective when the hardship is temporary, and recovery is expected within a relatively short timeframe.

How Credit Card Forbearance May Affect Your Credit

Credit card forbearance itself is generally not treated the same way as a missed payment, provided you follow the terms of the agreement. In many cases, participating in a hardship program can help you avoid delinquency and more serious damage to your credit profile.

However, there can still be indirect effects. If interest continues to accrue while payments are reduced or paused, your balance may increase. Higher balances can raise your credit utilization ratio, which may negatively impact your credit score.

It's also a good idea to monitor your credit reports and account statements throughout the process to ensure information is being reported accurately.

When Forbearance May Make Sense

Credit card forbearance is typically best suited for borrowers dealing with a temporary financial hardship rather than a long-term debt problem.

It may make sense if:

• You expect your income to recover within several months

• Your financial difficulties are temporary rather than ongoing

• You need short-term payment relief to avoid falling behind

• You have a realistic plan to resume payments once the program ends

If your debt is already unmanageable and your financial outlook isn't expected to improve soon, a different solution may be more appropriate.

Alternatives to Credit Card Forbearance

Forbearance isn't the only option available if you're struggling to get out of credit card debt.

Potential alternatives include:

• Balance transfer credit cards: Qualified borrowers may be able to move balances to a card offering a temporary 0% introductory APR.

• Debt management plans: Credit counseling agencies can help create structured repayment plans with participating creditors.

• Debt consolidation loans: Consolidating multiple balances into a single loan may simplify repayment and potentially lower interest costs.

• Debt settlement: In some cases, borrowers may negotiate with creditors to settle debts for less than the full balance owed.

• Bankruptcy: While a serious step with long-term consequences, bankruptcy may provide relief for borrowers facing overwhelming debt.

Bottom Line

Credit card forbearance is a short-term relief tool designed to help borrowers navigate temporary financial hardships. It can provide valuable breathing room when income is interrupted or when expenses unexpectedly rise. However, it doesn't erase debt, and interest may continue to accumulate while payments are reduced or paused.

If your financial setback is temporary, forbearance may help you avoid falling behind. If your debt problems are more severe or long-lasting, it may be worth exploring more comprehensive debt-relief options.

Credit Card Forbearance FAQs

What is credit card forbearance?

Credit card forbearance is a temporary arrangement between a borrower and a credit card issuer that may reduce, pause or modify payments during a period of financial hardship.

Does credit card forbearance forgive debt?

No. Credit card forbearance does not eliminate or forgive your debt. You will generally still be responsible for repaying the full balance owed.

Will interest continue to accrue during credit card forbearance?

Often, yes. Many programs continue to charge interest during the relief period, although some issuers may offer temporary interest rate reductions.

Who qualifies for credit card forbearance?

Qualification varies by issuer. Borrowers experiencing temporary financial hardship due to job loss, illness, reduced income or other qualifying events may be eligible.

How long does credit card forbearance last?

The duration varies by lender and program. Relief may last from a few months to a year in some situations.

Can credit card forbearance hurt your credit score?

Following the terms of a forbearance agreement generally helps avoid late-payment damage. However, increased balances and higher credit utilization may indirectly affect your score.

Is credit card hardship assistance the same as forbearance?

The terms are often used interchangeably. However, hardship assistance programs can offer a broader range of payment relief options, depending on the issuer.

Key Terms

• Credit card forbearance: A short-term arrangement between a borrower and a card issuer that may pause, reduce or modify payments during a period of financial hardship. It doesn't forgive the debt.

• Hardship program: The broader name for issuer relief options — sometimes used interchangeably with forbearance — that can include lower payments, a reduced APR, fee waivers or a temporary pause in collection activity.

• Debt forgiveness: The cancellation of all or part of what you owe. Forbearance is not debt forgiveness — the balance remains your responsibility.

• Annual percentage rate (APR): The yearly cost of borrowing on your card. Some hardship programs temporarily reduce your APR, but the regular rate generally returns when the relief period ends.

• Credit utilization ratio: The share of your available credit you're using. If interest pushes your balance higher during forbearance, your utilization can rise and may weigh on your score.

• Delinquency: A missed or late payment status. Following the terms of a forbearance agreement is meant to help you avoid delinquency and the credit damage that comes with it.

• Debt management plan: A structured repayment plan set up through a nonprofit credit counseling agency that works with your creditors — one alternative to forbearance.

• Debt settlement: Negotiating with a creditor to resolve a balance for less than the full amount owed, often after default. The CFPB warns that for-profit debt settlement can be risky.

Sources

• CFPB: Need help with your credit card debt? Start with your credit card company! 

• CFPB: What should I do if I can't pay my credit card bills? 

• CFPB: Credit card debt: relief options and tips

• CFPB: What is a debt relief program and how do I know if I should use one? 

Summary generated by AI, verified by MoneyLion editors

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