A given period of time during which a lender does not require payment on a loan and principal and interest does not come due for payment is a grace period. Grace periods are commonly provided with concessional loans, which are loans that lenders would not grant to debtors with similar risk in order to increase the probability of recovering a significant portion of the debt it is owed by the distressed borrower.
Debt waiver is creditor’s cancelling of all or part of the outstanding debt of an individual, company or country, including unpaid accrued interest. A partial waiver occurs when a creditor agrees to release the debtor for the full amount of its indebtedness against partial payment (e.g., 60%), either in cash or in kind.
A creditor will probably only waive a debt when it believes it is highly unlikely that it will receive a material amount on the debt and/or that the cost of achieving payment will exceed the likely proceeds. The creditor must explicitly inform the debtor that the debtor is no longer required to meet its obligations under the debt.