Definition: A temporary postponement or reduction of loan payments granted by a lender instead of forcing a borrower into default.
Examples: A small business experiencing cash flow issues during a downturn may request forbearance from its commercial lender to avoid default.

A commercial landlord granted forbearance to a tenant company struggling to meet lease obligations during a seasonal downturn, allowing them to defer rent payments for three months.

After negotiations, the lender agreed to a forbearance agreement that paused loan payments while the business secured additional funding.

Forbearance was a strategic choice for the creditor, who preferred preserving the long-term client relationship over initiating aggressive collection actions.

The forbearance period allowed the company to restructure its operations and regain financial stability without facing immediate legal action from creditors.