Forbearance is a temporary postponement or reduction of loan payments granted by a lender to a borrower who is experiencing a short-term financial setback, such as a job loss, illness, or unexpected expenses. In the context of a mortgage process, forbearance is a special agreement between the lender and the borrower to delay a foreclosure. The borrower must demonstrate the need for postponing payments, and the terms of the forbearance agreement are negotiated between the borrower and the lender. Forbearance does not erase or decrease the amount owed on the loan, and the borrower is still obligated to repay any missed or reduced payments. The type of forbearance granted depends on the borrowers individual circumstances, and each lender is likely to have its own suite of forbearance products. For example, borrowers in short-term financial difficulty would be more likely to be approved for a short-term full moratorium or negative-amortizing deal than customers in long-term financial difficulty, where the lender would seek to ensure that the capital balance continues to be reduced via an amortizing forbearance arrangement. It is important to note that forbearance is not a solution for borrowers with more serious problems, where the return to full loan payments in the long term does not appear sustainable.