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What Is Credit Card Deferment And How Can You Get It?

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Many people are wondering what to do about their credit card bills now that they are out of work because of the Coronavirus pandemic. There’s some good news! If you find yourself in a situation where you are unable to meet your financial obligations, consider applying for a credit card deferment. Most card issuers are giving financial assistance, such as debt relief and a suspension of payment to their cardholder clients.

If you are wondering what credit card deferment is and how you can get it, read this post to the end, and we will break it down for you.

When pandemics like the COVID-19 disease ravage our societies or when natural calamities such as typhoons strike, you or your business might experience financial hardships. As a result, you may find it difficult to meet your financial obligations, including making payments for your credit cards. You, however, do not need to worry too much about these financial obligations due to the recently passed CARES Act. This is because depending on your card issuer’s policies, you can approach them and ask for a credit deferment.

How Does Credit Card Deferment Work?

So, what does credit card deferment really mean? It means that you can discuss with the institution that issued you a credit card to suspend payment collection to a later date. While it is only a temporary relief to debt, a deferment could be the help you need to find lasting solutions to the issues you are currently facing. This is because it will let you reorganize and prioritize your finances without the pressure of making credit card payments.

Institutions suspend debt collection for a few days or months. You need to apply and negotiate a credit card deferment based on your financial projections. Your card issuer will allow you to extend this period if it lapses before you recover financially.

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It is important to note, however, that each institution has its own terms and conditions. You, therefore, need to report your situation to your card issuer ASAP and negotiate with them in order to get the deferment plan that will work best for you.

What You Need To Know:

  • Debt relief is NOT debt forgiveness! We have to be clear about that.
  • Your credit line can be extended. When you negotiate for a suspension of credit card debt collection, you can request for more credit and extended repayment period.
  • Your creditor will renegotiate new terms and conditions when you apply for your credit deferment.

Different creditors will offer you different terms and conditions for any loan facility, including credit card deferment. For instance, some institutions will reduce interests that your credit card debt may accrue during the deferment period. Others might eliminate the fees payable for that time while others will not.

You also need to know that the interest on your credit card debt will continue to be compounded. When you are ready to begin making regular repayments, therefore, you will need to renegotiate new monthly installments and repayment periods, depending on your financial strength. Stay in regular and close contact with your creditors.

Many institutions have developed tailor-made customer assistance products for their clients. They are offering financial assistance based on the needs and the unique circumstances of their customers.

To find out if your card issuer could help you out, call them or use their online platform to contact them and inquire about their credit card deferment policies. Due to a large number of callers, banks are advising their clients to expect a delay before their queries can be responded to. To beat this, you can use your bank’s online platform to contact them or even try contacting them through other means such as their social media accounts.

What Are The Creditors And Banks Offering At This Time?

Various institutions have different assistance programs. We have sampled a few for you here:

American Express –

They are offering different programs that could ease the debt burden for their cardholders. The firm has updated information on their website, guiding cardholders on what to do when faced with a financial crisis. Among the incentives that the institution promises its clients is to lower monthly installments and eliminate late repayment charges. They are experiencing a higher volume of calls, and they advise that customers use the online platform instead. Here’s more info: https://www.americanexpress.com/en-us/company/notice/covid-19/

Barclays –

They have reported an increase in their call volumes. They request customers to contact them using their online platform. However, they have not specified which credit relief programs they have for their clients.

Capital One –

They have a page on their website that directs cardholders on how to seek assistance. There is no specific information on the kind of help they are extending to their cardholders. The cardholders who need help are advised to contact them via the telephone or through their website.

Bank of America –

They have an assistance program that is responding to cardholders’ applications based on individual needs and circumstances. They are offering numerous credit relief and refunding any late repayment charges deducted from cardholders’ accounts. You can reach out to them here: https://about.bankofamerica.com/promo/assistance/client-assistance

Discover –

Cardholders may contact them through their website to be advised on credit card payment collection suspension. The credit provider has specific details for each client since they are assisting cardholders on a case-by-case basis.

Besides the above firms, there are other card issuers not listed here that are assisting their creditors. All you have to do is apply for the specific help that you may need.

Conclusion –

You should consider getting a credit card deferment if you are experiencing a financial crisis, and you are unable to make your payments on time. To get assistance from your card issuer, be sure to contact them and negotiate for a debt relief plan that suits your current situation. For instance, you can request them to suspend your credit card payment collection for perhaps three months to give you some breathing room. Don’t be afraid to reach out to one of our certified credit counselors for assistance. We’re a non-profit credit counseling agency and we’re here to help you any way that we can!

Here are some more great articles explaining credit card deferment and which creditors are providing assistance at this critical time:




Author: Lauralynn Mangis
Lauralynn is the Online Marketing Specialist for AdvantageCCS. She is married and has two young daughters. She enjoys writing, reading, hiking, cooking, video games, sewing, and gardening. Lauralynn has a degree in Multimedia Technologies from Pittsburgh Technical College.