Although there are many upsides to using a deferred payment plan, there are a couple of disadvantages that any consumer should be aware of. The main disadvantages include additional interest charges, larger monthly payments, and/or a large balloon payment at the end of the loan repayment period. — Additional interest charges: When the loan is in deferment most lenders will continue to charge interest on the loan. — Larger monthly payments: Depending on the terms of your deferred payment plan, you may need to pay larger monthly payments once payments recontinue on the loan. — Balloon payment: Some lenders add larger payments at the end of loan repayment periods known as balloon payments. Although these disadvantages may be somewhat undesirable, when you look at your financial situation the costs may be worth helping you through short-term difficulties like an emergency car or home repair, catching up on your monthly bills, or taking care of a medical or dental bill.