The loan is able to help in many circumstances, but although it will get it, it is often a matter of a few minutes, giving away can be more troublesome. What are the consequences of not paying back the loan on time?
Any day you’ll get a prompt!
Internet users google very often in search of such information – what if they do not pay off the loan on time? or: what are the consequences of not repaying the loan within …
Has the loan repayment deadline yet expired? settle your arrears quickly, because you will face expensive consequences!
The answer is clear – the first will be a prompt, in other words, a request for payment. It’s just a kind of commitment reminder – you can expect it after the seventh day of delay.
There are several types of prompts, the first is:
- electronic, in the form of an e-mail or SMS. At the same time, it is the least costly way to remind you,
- followed by a phone prompt, considered to be made, even if you did not answer the call,
- later the prompt comes by letter – it is also the most expensive request for payment, although it also depends on the type of letter. Usually the prompt comes by registered mail.
Debt collection proceedings
Some shrug their shoulders for further prompts, which has its deplorable effects. If such requests are ineffective, the lenders initiate recovery proceedings.
Debt collection is a set of legal actions intended to lead to the debtor paying off the debt, although the debt collection procedure is divided into amicable and judicial.
Amicable debt collection is monitoring repayments and subsequent calls in case of delays. It’s like a more insistent continuation of sending reminders. Debt collection is another matter – it requires a court order for payment, which opens the door to bailiff’s enforcement.
Debt collection is a phased process that initially assumes the debtor’s good will and is quite benign. Therefore, it is worth showing your good will to communicate with the creditor as soon as possible and negotiate the best repayment terms.
Debt collector and bailiff
The confusion of these two gentlemen is extremely common. However, there is a difference between them, especially in permissions and competences. If the creditor decides to collect the debt out of court, he or she turns to the debt collection company.
I have already discussed debt collection, so I will only add that as a last resort the debt collector may appear in person and knock on the debtor’s door. However, this is just another reason to negotiate, this time in private.
It is only when all these good-natured methods fail that it is necessary for the bailiff to step in. Contrary to the debt collector, the bailiff performs a public function at the district court. Because of this, he has much more rights.
What can a bailiff do?
It is the creditor who decides to start the bailiff proceedings and it is he who influences what the bailiff will take. All thanks to the application for enforcement.
So regardless of the type and amount of debt, salary, mobility, real estate and almost any property can be seized at some point.
Busy items are usually sold at public auction. Importantly, home appliances and audio and video devices do not bother the bailiff’s head with questions such as “whether it really belongs to the debtor.”
If they are in his apartment / house, he can take them. This can later be unscrewed in court (I described it in one article), but … it’s best not to lead to such a situation.
Application for consumer bankruptcy
Sometimes it is so that despite good intentions and giving everything, it is not possible to pay off the debt. Then it is possible to declare consumer bankruptcy.
Consumer bankruptcy leads to complete debt relief, in other words debt write-off. Creditors’ claims cannot then be satisfied – bankruptcy says that the debtor simply cannot pay the debt.
Consumer bankruptcy can be declared by anyone who is overwhelmed by financial problems, although these are not the result of his fault. However, it can be shown that indebtedness is the result of too little knowledge, etc. The court is also inclined to go to the debtor in such situations.
Do not allow looping
In other words – to the debt spiral. Sometimes borrowers take another loan to pay off the previous one, and this is the beginning of a very dangerous spiral. Do not let it happen – anything will be better, but not taking a loan to pay off another.
First of all, change your approach and grab your hand when you want to sign another loan agreement. Get caught in the temptation of such a step. The situation is difficult and the next commitments are only adding to the difficulties.
So it’s better to group your commitments in a sober order. Let the first ones be those whose payment deadline has already passed or is approaching. Interest must also be taken into account. The rest is our sense – e.g. giving up some pleasures.
How to avoid the sad consequences of defaulting on a loan?
Failure to pay loans on time has sad consequences, but they can be avoided. Only a few rules will do this. If we already take out a loan, it is only with 100% certainty that it will be possible to pay it back.
For example, you need to analyze how much it seems and how much you can save. Before we take a loan, let’s also get acquainted with the table of fees and commissions in a given loan company or bank.
If memory fails, it’s a good idea to write your dates on your calendar. Payment deadlines are extremely important, they must not be underestimated. I have already discussed this topic on the blog so many times that I can treat this text as a kind of vague reference.
If this is your first time here, search the blog content for specific questions. Because defaulting on loans before you look – it can take your entire household budget to the brink of collapse! also mental!