Most lenders allow one deferral per loan, but some permit two
The number of times you can defer a car payment depends entirely on your lender's policy, not on federal law or industry standard. Most traditional auto lenders—banks, credit unions, and captive finance companies—allow you to defer one payment during the life of the loan. Some lenders permit two deferrals, but this is less common. A few subprime lenders may allow more frequent deferrals, but they typically charge a fee each time.
Your loan agreement spells out the exact limit. If you haven't read it, contact your lender's customer service line and ask directly: "How many payment deferrals am I allowed under my loan?" They can tell you whether you have used any already and whether you have deferrals remaining. This matters because once you hit your limit, you cannot defer again—you will have to pay or face late fees and credit reporting.
Deferral is not the same as skipping a payment. When you defer, the payment is pushed to the end of the loan, and you still owe it. When you skip, you simply do not pay and damage your credit. Deferral is a formal arrangement; skipping is default.
Key Takeaways
- Your loan documents state how many deferrals you are allowed; most lenders permit one, some permit two, and the limit is per loan, not per year.
- Once you use a deferral, that payment moves to the end of your loan term and you still owe it in full.
- Deferral requests must usually be made before the payment is due, not after it is late.
- If you have already used your deferrals, you cannot defer again; your only options are to pay, refinance, or negotiate a loan modification.
- Some lenders charge a fee to process a deferral, and some report the deferral to credit bureaus even though it is not a missed payment.
When you can request a deferral and what happens to the payment
Contact your lender before your payment is due, not after. Most lenders will not grant a deferral once a payment has already missed. Some will allow you to request one up to 10 days before the due date; others require more notice. Call and ask what your lender's window is.
When the deferral is approved, your payment does not disappear. It is added to the end of your loan. If you have 24 months left on your loan and you defer one payment, you now have 25 months left. You will pay that deferred amount in your final payment or spread across the last few payments, depending on how your lender structures it. Read the approval paperwork to see exactly when and how the deferred payment will be collected.
Some lenders charge a deferral fee, typically $25 to $100. This fee is separate from the payment itself and may be added to your loan balance or charged upfront. Ask whether a fee applies before you request the deferral.
How deferral affects your credit and your loan timeline
A deferral that is processed correctly and approved in writing does not count as a late payment on your credit report. Your payment history should show no missed payment for that month. However, some lenders do report the deferral itself as a notation on your credit file, which may be visible to other creditors even though it is not a delinquency. The impact on your credit score is usually minimal compared to a missed payment, but it is not zero.
The deferral extends your loan term. If you were paying off your car in 60 months and you defer one payment, you are now paying for 61 months. This means you will pay interest for one additional month. Over the life of the loan, this can add $50 to $200 or more in interest, depending on your interest rate and remaining balance. Calculate this cost before you request the deferral so you know what you are trading for the short-term relief.
If you are already behind on payments or have missed one, a deferral may not be an option. Lenders typically only grant deferrals to borrowers who are current. If you are behind, ask about a loan modification instead, which can restructure your payment schedule without requiring you to catch up immediately.
What to do if you have already used your deferrals
Once you have used all the deferrals your loan allows, you cannot defer again. At that point, your options are to pay the full payment on time, refinance the loan with a different lender, or contact your lender about a loan modification.
A loan modification is different from a deferral. It is a formal change to the terms of your loan—usually extending the term, lowering the payment, or both. Modifications are typically offered to borrowers who are struggling or behind, and they require the lender's approval. Unlike a deferral, a modification is permanent; you do not owe the payment later. However, it also extends your loan term and increases total interest paid, and it may be reported to credit bureaus as a negative mark.
If you cannot pay and have no deferrals left, contact your lender immediately. Do not skip the payment. Explain your situation and ask what options exist. Some lenders will work with you on a temporary arrangement even if a formal deferral is not available.
Deferrals with subprime and buy-here-pay-here lenders
Subprime lenders and buy-here-pay-here dealerships (where you make payments directly to the lot) sometimes allow more frequent deferrals than traditional lenders. Some permit one deferral per year rather than one per loan. However, these lenders almost always charge a deferral fee—often $50 to $150 per deferral—and they may report deferrals more aggressively to credit bureaus.
Buy-here-pay-here lots may also have stricter rules about when you can request a deferral. Some require you to request it in person at the lot, not by phone. Others will only grant deferrals if you have been current for a certain number of months. Read your contract or call the lot directly to understand your specific limits.
If you are financing through a subprime lender and you know you will need flexibility, ask about deferral policy before you sign. It is a legitimate question and a legitimate factor in choosing where to finance.
How to request a deferral and what documents you need
Call your lender's customer service number—the one on your loan statement or bill. Ask to speak with someone in the loan servicing or payment department. Have your loan number and account number ready.
Explain your situation briefly: you are having a temporary hardship and need to defer your next payment. You do not need to provide extensive detail, but lenders often ask what caused the hardship (job loss, medical emergency, car repair, etc.). Be honest but concise.
The lender will tell you whether you are may be able to access based on your account history and remaining deferrals. If approved, they will send you a written confirmation via email or mail. Do not rely on a verbal approval. Wait for the written confirmation before you skip your payment. The confirmation will state the deferred payment amount, when it will be collected, and any fees.
Keep this confirmation with your loan documents. If a payment is later reported as late by mistake, you will need this proof that the deferral was approved.
Frequently Asked Questions
Can I defer a payment if I am already one month behind?
Most lenders will not grant a deferral if you are already delinquent. You would need to catch up first or ask about a loan modification instead. Some lenders will modify a loan for a borrower who is behind, but deferral is typically only for borrowers who are current.
If I defer a payment, will my credit score drop?
A properly approved deferral should not appear as a missed payment on your credit report, so it should not cause a significant score drop. However, some lenders report the deferral as a notation, which other creditors may see. The impact is usually much smaller than a missed payment would be.
What happens if I defer a payment and then lose my job before the deferred payment is due?
Contact your lender immediately. Explain the new hardship. You may be able to negotiate a loan modification that restructures your payments more substantially than a single deferral would. Do not wait until the deferred payment is due to reach out.
Can I defer multiple payments at once?
No. A deferral is typically one payment per request. If you need to defer multiple months, you would need to request deferrals separately, and you can only do this if your loan allows multiple deferrals and you have not used them all.
Does deferral mean I do not have to pay that money?
No. Deferral moves the payment to later in your loan term, usually to the end. You still owe the full amount. The only way to reduce what you owe is through a loan modification or by paying off the loan early.