DEFERRED WITHOUT CONSENT — The Hidden Credit Damage of Unauthorized Loan Forbearance
R23 Law’s California Consumer Protection Attorneys Are Helping Borrowers Fix Their Credit and Seek Compensation
Forbearance Gone Wrong: What Happens When the Pause Isn’t Your Choice?
During the height of the COVID-19 crisis, many banks and lenders rolled out loan forbearance programs to support struggling borrowers. While well-intentioned, these programs weren’t always executed with transparency—or consent.
In some cases, lenders placed consumers into forbearance automatically, without notifying them or getting approval. The result? Missed payments, misreported deferments, and severe credit score damage—especially for borrowers who were actually continuing to make payments.
At R23 Law, our California Consumer Protection Attorneys are actively helping clients correct credit report errors and hold lenders accountable for unauthorized forbearance entries.
What Is Unauthorized Loan Forbearance?
Loan forbearance allows a temporary pause on payments—often used during hardship situations. But when this pause happens without your request or consent, it can:
Halt automatic payments you intended to make
Trigger “deferred” status on your credit report
Damage your credit score due to perceived delinquency
Disqualify you from refinancing, renting, or job opportunities
If this has happened to you, you may be entitled to legal remedies.
Case Spotlight: Great Lakes Borrowers Experience Sharp Credit Drops
In early 2020, Great Lakes, a federal student loan servicer, automatically applied forbearance to millions of borrowers—then reported the deferred payments to credit bureaus. For one consumer, this move caused her credit score to drop by 44 points overnight, despite no missed payments.
Many borrowers were never informed. The forbearance looked like skipped payments—even if they had been current on their loans.
Case Spotlight: Wells Fargo Mortgages Raise Bankruptcy Concerns
In a separate incident, Wells Fargo applied mortgage forbearance to accounts without borrower approval. For one homeowner navigating a bankruptcy plan, this unauthorized action nearly jeopardized his case. He continued making payments—but Wells Fargo reported deferment, creating the appearance that he was violating court orders.
This isn't just a paperwork error—it’s a legal and financial disaster, with long-lasting consequences.
The Hidden Costs of Automatic Forbearance
Here’s what unauthorized loan forbearance could mean for you:
Lower Credit Scores: “Deferred” loan statuses may be seen as risk indicators.
Missed Good Credit History: Paused payments mean no reporting of on-time payments.
Loan & Rent Denials: Damaged credit can cost you mortgage opportunities or apartment applications.
Emotional Stress & Financial Setbacks
And in many cases, you may not even realize forbearance occurred until you check your credit report.
R23 Law’s California Consumer Protection Attorneys Are Here to Act
We represent borrowers throughout California whose lenders:
-Placed their loans into forbearance without consent
-Reported inaccurate “deferred” or “missed payment” statuses
-Damaged their credit or caused refinancing and renting obstacles
-Violated federal consumer protection statutes, including the FCRA
Our legal team will investigate the facts, challenge wrongful credit reporting, and file claims for damages—including monetary compensation and corrections to your credit file.
Your Credit Is Personal. Your Legal Rights Are Powerful.
If your bank or loan servicer altered your loan terms without permission, you may be able to sue for damages under the Fair Credit Reporting Act (FCRA) and other consumer protection laws. You may also be entitled to:
Statutory damages
Credit report correction
Actual damages for financial harm
Attorneys’ fees and costs
R23 Law Can Help You Set the Record Straight
Our attorneys take immediate legal action to:
Dispute inaccurate entries on your credit report
Reverse the harmful impact of unauthorized forbearance
Seek compensation for your losses and emotional distress
We’ve helped borrowers across California correct credit errors and hold major lenders accountable.
Take Action Now—Protect Your Credit and Your Future
📉 Has your credit score dropped for reasons you can’t explain?
📬 Received a forbearance letter you never signed up for?
🧾 Found “deferred” loan entries without your consent?
Let R23 Law investigate and pursue justice on your behalf.
Contact R23 Law Today
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💼 Representing clients across California
💬 Multilingual attorneys available
