What Is Moratorium Period In Case Of Loans?

In terms of loans, a moratorium period refers to a period of time that is agreed on between the lender and the borrower in which the loan and the interest is to be repaid.

• Moratorium: Why are they available?

The main principle of having a moratorium is so an individual who has taken out a loan has some extra time to pay it back to the lender. However, each moratorium period is different depending on each individual circumstance. Some people may be awarded a longer period of time than others depending on the amount they have borrowed or the reasons why they are not available to pay it back straight away. This is usually the process that is agreed on before the creditor makes official demands for the repayment.

• Debt Moratorium

This method is used quite a lot when it comes to debt repayment. In this case, the creditor gives the debtor a later date to begin paying back the required amount; however there is no specific date used in these circumstances either. It is simply judged depending on the situation and how much debt needs to be repaid. If the debt is not paid back within this time period then the creditor will take additional measures to claim back the debt from you.

• Debt Forgiveness

In some cases the situation may come to a head where the creditor awards debt forgiveness, although this is relatively rare. This process consists of the creditor letting you off from paying the whole amount or a section of the debt in question. In most instances this is only awarded if it is virtually impossible for the person(s) to pay back their debt.

In simple words, Moratorium Period is nothing but loan repayment holiday. If you want to get the loan disbursement and not yet ready with the provision of Equated Monthly Installments (EMIs) or Pre-EMIs, loan borrower is given an option to pay some amount (as decided by banks policy) instead of and EMI or pre EMI. The moratorium period is included within the maximum repayment period

I need a moratorium on some of my credit cards.  What must I do to make this happen?