forbearance


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Related to forbearance: Forbearance Agreement

Forbearance

The temporary suspension of loan repayments due to demonstrated financial hardship on the part of the borrower. Interest continues to accrue during forbearance and thus may extend the repayment period or cause payments to increase once they re-commence. A borrower must apply to the lender to be considered for forbearance.

forbearance

The act of restraining from exercising a right.

1. Typically encountered in leases and other contracts specifying that a forbearance by one party who fails to declare a default when entitled shall not entitle the other party to rely on future forbearances and will not constitute a waiver of any rights.

2. After a loan default, lenders will sometimes enter into formal forbearance agreements with borrowers, agreeing not to foreclose if the borrowers will agree to a new payment plan, pay all attorneys' fees associated with drafting the agreement, usually agree to a  higher interest rate and more collateral, and almost always agree to waive any and all claims against the lender.

References in periodicals archive ?
During the Forbearance Extension Period, the Company and its creditors have made significant progress in their negotiations regarding a deleveraging transaction.
evaluation of administrative forbearance authority.
The new forbearance arrangement expires on 27 February 2014 and relates to the interest payment due under the notes on 28 August 2013, which is still unpaid.
This paper is related to Brown and Dinc (2011) documenting the too-many-to-fail channel of regulatory forbearance in that our sample period is characterized by a series of exits of savings banks resulting from the restructuring plan of the Korean regulatory authority.
To the extent this process is not completed by May 20, 2013, the forbearance agreement may be extended further by agreement of the parties; however, there is no assurance any further extension will be provided.
So, here are some concepts and provisions to consider when preparing a forbearance agreement.
Now, Sallie Mae student loan borrowers who suspend their payments won't be required to pay forbearance fees until after they resume regular payments, the company said.
Although the investors wanted to redeem their shares as soon as possible, after negotiations they entered into a forbearance agreement with the company by which the investors agreed to forbear from exercising their redemption rights for a period of one year.
Forbearance agreements enable lenders to secure the value of these properties and work with the developers while awaiting the market to improve to sell the condominium units.
Midwest Bank (NASDAQ: MBHI) has entered into a forbearance pact with its lender, Milwaukee-based Marshall & Ilsley Bank.
Two facets of the law make forbearance particularly powerful.
Luckily, the 2004 graduate of Rutgers University College of Engineering knew a little something about forbearance, a temporary suspension of loan payments that most lenders will allow when times are tough.