A very obvious advantage of the signed loan is that the loan does not require the lender to pledge any assets. Does that mean that if the lender fails to repay the loan on time or absconds with the money, he cannot be punished? Of course not. The first and most important thing is that it will have a great impact on the credit of the lender. Not only is the credit problem of the lender, but also there are some practical actions that can punish the lender, including the following.
There is a formal collection agency involved
If you fail to contact or repay the loan after your default, you should be aware that the borrower will probably formally contact some collection agencies to give your personal information to the collection agencies, and then they can draw part of the debt collected as the commission for this action. So once your debt is transferred to the collection agency, the situation will be relatively serious, not only your credit score will be seriously damaged, In the face of the active collection of collection agencies, it will also have a great psychological impact on you.
You will receive new notifications
If you have carefully read the relevant regulations when signing the loan contract, you will know that if you default on the loan, you will be given different liquidated damages or compensation in installments and batches as the loan time extends, and even the amount you need to pay in different time periods is very different. If you can actively negotiate with the borrower at this time, It is the most important to explain your current difficulties and negotiate a solution that both parties are satisfied with. If you ignore it, it is likely that this notice will affect your current work, life and even the evaluation of the surrounding people on you, leading to your loss of your current job. This is a very unacceptable consequence. Therefore, no matter what you receive, please find a suitable solution immediately, Proactively seek solutions.
You will be subject to compulsory measures by the court
If you have started the default operation, the borrower can protect its own rights and interests through legal means. Specifically, if you cannot repay the loan on time, the court has the right to legally confiscate your property after the borrower takes you to the court, and can even deduct money from your work capital to the borrower on time. But generally, the court will not do this, but will still take compulsory measures to interfere with your normal life now, Then you need to take the initiative to find other ways to see if there are other funds to fill the gap.
The worst is bankruptcy
If you have gone through the third step and have been forced to carry out the asset inventory by the court, then at this time, you still cannot find other sources to solve the current problem. Your assets will probably be auctioned to make up for the loan loophole. Whether it is the official act of the court or you auction the assets yourself, it means that all your previous efforts have been wasted, That's what we don't want to see.
