The application for a loan, of whatever type, carries a millimeter obligation. The payment of fees and interest must be paid on time. These must occur on the date established in the signed contract. Due to various circumstances, such as loss of employment or decreased income, defaulting on a loan can become an unwanted reality. What can we do in these cases?
Reasons for which you can appeal in default
Resorting to default can be due to various causes, although the main ones are:
- Loss of employment: If someone loses their job, the income from unemployment benefit is usually used for the most basic needs. Meeting the terms of a loan is an obligation, it is not a good idea to stop paying.
- Lack of liquidity: circumstances such as a reduction in income, for example, an unwanted reduction in working hours.
- Over-indebtedness : it is the inability to meet debt payments. Either due to lack of foresight or overconfidence when contracting a loan. Very common in compulsive people who buy more than they need. It also occurs in cases in which loans are requested to pay other debts.
- New family circumstances: a family increase or a divorce process can reduce our economy.
What to do if I cannot pay a loan?
It is always highly recommended to be proactive, and bear in mind that a loan or credit is a possibility that is always there. Well used allows you to enjoy liquidity. If for any reason you know that you cannot afford the installments and you will not be able to pay your loan, we recommend the following:
Anticipate the situation
If you don't pay the fees, it won't take long for you to receive a call from the bank or financial institution. Anticipate the situation and call before by phone, or better yet, in person go to the office and expose your problem. It is much better that you go with the spirit of looking for a solution, which there is. One of them may be to refinance the debt, in such a way that the loan takes longer to be paid, but the fee is lower. Or also, establish a grace period with which you will only pay the interest for a while.
Do not have disgrace
Dialogue is always a good way to expose your difficulties and try to find a solution. The bank or financial institution prefers to have someone who pays little by little, but who pays. You don't want a defaulter who ignores the problem. We have already explained in a previous article what it means to be on one of these lists, and how you can get out of them.
Willingly, it is possible to reach a good agreement that allows for a negotiated solution. Obviously you will have to pay yes or yes, since the debt is not going to be forgiven. However, it is possible to make payments more comfortably. Never, under any circumstances, stop paying or ignore calls or communications. In addition to seeing yourself on a list of defaulters, you can initiate a non-payment order that will end up in court. One way or another, you will end up paying. Acting proactively is the best way to protect yourself against defaulting on a loan.