I can never ever even begin to stress quite enough how important repaying debts are. If someone looking to borrow finance they must repay it and they have to do this as agreed with the lender who granted the finance in the first place. Missing loan repayments and other financial commitments will nearly always result in severe negative consequences for that person involved and most people here will look to avoid this from ever happening. It does not matter whether a person has borrowed short term loans, instalment loans or even credit cards the debts must be repaid on time. Below in this article are three actions that will nearly always occur when repayments are missed on short term loans in particular but most other debts to.
When repayments are missed to Creditors for short term loans, that lender then has the right to contact that person to chase the money they are owed. They can look to contact that person on all contact numbers they have available, this can often include mobile numbers and also home and employment details which would have most likely been supplied during the borrower’s application. The lender can also send frequent emails chasing their money as well as letters to the home address. Now for anyone being chased for money is not nice and can almost certainly be stress enough for that person. Also if letters are sent and calls are made to employment details or home numbers it could lead to other people knowing about the loan and the now debt. No one would want that.
Missing financial commitments on short term loans and other borrowing will nearly always affect a person’s credit rating negatively. This when it occurs can make it harder for that person to then get accepted for other finance in the future. This can be tough on people later in life if they are looking to make a significant purchase of some kind such as a new car or a mortgage etc. Some lenders when they view a person’s credit file if they can see other repayments have been missed especially if this has happened recently, the borrower can find it tough to get accepted for finance. There are however, some lenders such as payday lenders who could possibly look to offer finance for people with bad credit so bare that in mind.
Another common occurrence for when someone missed debt payments would be the balance increasing on the debt. This can make it harder then for that person to one day clear the debt should they choose to action this. Interest and charges can often be added to the balance on an account when it is overdue and sometimes this can be done so a rapid rate. On some short term loans such as payday loans when they are overdue it can increase very quickly. For the future for someone they may then struggle to clear this debt in the future. It can be common that someone people may just not have the required funds for a month or so, then can then look to settle the overdue instalment on their next payday. When this is done on some debts that person may be surprised at just how much their balance has increased for them being behind on payments even just for a short time frame.