To ask your lender to pause or lower your business loan payments, call or write before you miss a payment, explain the specific cause (a slow season, a customer who did not pay you), propose a specific fix (interest-only for three months, a longer term, or a temporary reduced payment), and get everything in writing. Lenders usually have more options before the first missed payment than after it.
Nobody is required to say yes. But an owner who shows up with numbers, a clear cause and a plan to get back on track has a much better shot at getting something. Below you will find what to ask for, what to bring, a script you can read almost word for word, and the email to send afterward. If English is your second language, keep the script in front of you: many collections and servicing teams work only in English, and reading from a page keeps you calm and precise.
Key takeaways
- Call before you miss the first payment: after that, your file usually moves to collections and flexibility shrinks.
- Ask for something specific: an interest-only period, a temporary reduced payment, a 1- to 3-month pause, or a longer term.
- Bring numbers: sales for recent months, the cause of the dip, and when you expect to recover.
- Get any agreement in writing, with dates and amounts, before you stop paying the normal amount.
- With a merchant cash advance (MCA), what you negotiate is lowering the payment to match your actual sales.
- If it is an SBA loan, your first contact is your bank; only loans the SBA has already purchased are handled in the SBA Loan Portal.
The options you can ask for (and what lenders call them)
Knowing the right name for each option helps you ask for something the lender recognizes and can route to the right desk. These are the most common:
| Option | Lender term | What it does | When to ask for it |
|---|---|---|---|
| Payment pause | Deferment / forbearance | Stops payments for a short time; interest usually keeps adding up | A short dip with a clear return date |
| Interest-only | Interest-only period | You pay interest but no principal for a few months | Sales are lower but steady |
| Temporary reduced payment | Temporary payment reduction | You pay less for a set period, then return to the normal or an adjusted payment | A partial drop in sales |
| Longer term | Loan modification / term extension | Spreads the balance over more months to lower the installment | The problem is not temporary |
| New due date | Due date change | Moves the draft to when your money actually comes in | Your customers pay you on a different schedule |
Keep in mind that pausing or extending almost always raises your total cost, because the money stays borrowed longer. Use it to survive the dip, not as a habit.
Before you call: build your case in 30 minutes
- Read your contract. Search for default, late fee, grace period and modification. That tells you how many grace days you have and what happens if you are late.
- Pull your numbers. Monthly sales for the last 6 months, your bank balance and your fixed costs. A one-page summary is enough.
- Write the cause in one sentence. "We lost a contract that was 40% of sales" or "the rainy season stopped jobs for three weeks." Those are examples; what matters is that yours is real and verifiable.
- Figure out what you can actually pay. Offering an amount you can hit every time beats offering one you will break next month.
- Have a return date. When do sales come back? A signed contract, a busy season or a confirmed order gives the lender confidence.
Documents to have on hand: your last 3 to 6 business bank statements, a simple profit-and-loss statement (a spreadsheet is fine), your most recent tax return and, if a customer did not pay you, the overdue invoice or the email where they told you. If the dip came from a breakdown, have the repair quote. With this, the lender can decide in one review instead of asking for papers three times. Also list your other debts with their monthly payments: the lender will want to know whether the problem is only with them or with everyone.
If you are already behind, the conversation changes. Read business funding with recent late payments to see where you stand.
The script: what to say on the call
Call the loan servicing department, not sales. Ask for the person's name and write down the date and time. You can read this almost word for word:
"Hi, my name is [name], owner of [business], loan number [number]. I'm calling before my next payment is due because my sales dropped due to [cause]. I want to keep paying and stay current. What options do you have for an interest-only period or a reduced payment for [2 or 3] months? I can pay [amount] per month during that time, and I expect to return to my regular payment by [month] because [reason: contract, season]. What documents do you need to review this?"
If they say no, ask: "Is there another option you can offer?" and "Can I speak with someone in hardship or workout?" Often the first person you reach has no authority to approve changes. Stay polite and specific; the goal is to be the easiest file they handle that day.
If you are more comfortable in Spanish, ask whether the lender has Spanish-speaking staff. If not, you can bring a bilingual family member or your accountant on the call, as long as you are the one authorizing the conversation. A Spanish version of this script is on our Leer en español page.
Put it in writing: a model email
After the call, send an email the same day. It protects you if someone later says there was no agreement:
Subject: Request for payment adjustment – loan [number]
"Today I spoke with [name] about my request for [interest-only / a reduced payment] for [months] due to [cause]. Attached are my bank statements for the last [3] months. I propose paying [amount] per month from [date] to [date]. Please confirm in writing whether this is approved, along with the new terms, before my next payment on [date]."
- Do not stop paying until you have approval in writing. A promise on the phone does not stop late fees.
- Review the agreement: how long it lasts, whether interest is added to the balance, whether the maturity date changes and whether there is a modification fee.
- Keep everything in one folder: emails, names and dates.
If you have a merchant cash advance: ask to lower the payment
A merchant cash advance is not a loan with a fixed installment: it is the purchase of a share of your future sales. Many contracts include a reconciliation clause that lets the daily or weekly draft be adjusted when your actual sales drop. Ask for exactly that:
"My sales dropped [X]% over the last [weeks]. Under the reconciliation clause, I'm requesting an adjustment of my daily payment to match my actual receipts. Attached are my bank statements."
- Send bank statements that show the drop.
- Ask for the answer and the new draft amount in writing.
- If you have more than one advance, talk to each funder separately.
For more on this situation, read what to do if you are behind on MCA payments. If the draft still strangles your cash flow after you negotiate, Merchant Fund Express, our recommended funder, can review options to lower your daily or weekly payment to something your sales can support. Applying is free and does not impact your credit.
SBA loans and banks: who to talk to
If your loan is an SBA 7(a) or 504, do not call the SBA first: your contact is the bank or lender that made the loan (for a 504, the Certified Development Company too). According to sba.gov, only loans the SBA has already purchased from the lender are handled in the SBA Loan Portal; for everything else, contact your lender. For COVID EIDL loans, the SBA directs borrowers to its own servicing team.
Banks usually have a special assets or workout group for struggling businesses. Asking to be transferred there can open options like a longer term. If your bank offers nothing, compare the best refinance options for small businesses to see whether another lender would give you a lower installment.
A Small Business Development Center (SBDC) or a SCORE mentor can help you prepare your numbers for free before the call.
Mistakes that wreck the negotiation
- Going silent. Not answering calls is the fastest way to get your file sent to collections or attorneys.
- Promising what you cannot deliver. Breaking a new agreement damages trust more than the original late payment.
- Asking without a cause or a date. "Things are tough" gives the lender nothing to approve.
- Closing your bank account or switching banks to stop drafts. That usually violates the contract and makes everything worse.
- Taking on more expensive debt with no plan. If you need capital to get through the dip, have a clear plan; see the best funding for cash flow gaps, or ask Merchant Fund Express for a free review that does not impact your credit.
Frequently asked questions
Does asking for a payment pause hurt my credit?
Asking does not hurt your credit. What hurts is falling behind without an agreement, because many lenders report late payments to the business credit bureaus and, if you signed a personal guarantee, sometimes to your personal credit too. A written agreement before you are late usually avoids that report, but ask how the account will be reported.
What should I say when asking for a payment deferral?
You can say: "I'm requesting a temporary payment deferral or an interest-only period for [2 or 3] months because my sales dropped due to [cause]. I can pay [amount] during that time." Ask to speak with the hardship or loan servicing team, and confirm everything by email the same day.
How long can a lender pause my payments?
It depends on the lender and the contract. Generally, pauses and interest-only periods are short, one to a few months, and longer changes are handled by extending the term. Ask for what you really need with a believable return date, not the maximum possible.
Can the lender say no?
Yes. No lender has to modify your loan unless the contract provides for it. That is why it pays to come with numbers, a clear cause and a concrete proposal. If they say no, ask what option they can offer and request to speak with the hardship department.
What if I have an MCA instead of a loan?
With a merchant cash advance, you ask to lower the daily or weekly draft so it matches your actual sales, often using the reconciliation clause in the contract. Send bank statements that show the drop in sales and ask for the answer in writing.
What happens to interest during a payment pause?
In most cases interest keeps adding up, and sometimes it gets added to your balance. That means the loan ends up costing more. Before you accept, ask in writing how the balance, maturity date and new installment will look once the pause ends.