Kallyss can find you the best possible payday loan for your circumstances; even with a bad credit rating or if you are unemployed. However, it is vital that you know you will have the means to repay your loan when it is time to.
Finding yourself in the uncomfortable position of not being able to repay your payday loan can be difficult to process. There are, however, steps that you can take in order to minimise the damage that it may cause to your life and assets.
It is always important to consider what you are doing before taking out a payday loan, if you do not have a repayment plan in place before you apply then it can be dangerous and lead to consequences that are shown in the guide below.
If you are worried that you will not be able to repay your loan then it might be worth looking at alternatives to payday loans if you are desperate to cover some expenses quickly.
What Will Happen If You Do Not Repay Your Payday Loan?
There are some broad implications that will happen if you are not able to repay your payday loan on time. The first thing that your lender will do is send you many follow up emails, calls and letters to try and encourage you to repay.
If you have forgotten to repay these can serve as a good reminder to find the money for your repayment.
In terms of tangible issues that could happen, there will be late fees and added interest, this will mean that if you do not repay on time you may face rather large repayments and definitely much larger than you had originally anticipated.
Moreover, not repaying your loan on time will severely negatively affect your credit score and this will lead to you finding it much more difficult in the future to get credit elsewhere (find out more about credit scores here).
What Should You Do If You Cannot Repay?
There are some steps that you can take if you realise that you cannot repay your payday loan on time. The first thing that you need to is contact your lender as soon as possible.
Speaking to your lender can help you hopefully find an arrangement that works for both parties. This could be giving you more time in order to repay the loan or finding alternative ways to pay off the loan.
A payment schedule that becomes more affordable can only happen if you contact your lender as soon as you realise you cannot repay. The longer you wait the worse it can become for you!
There is a chance that you find yourselves in trouble with money and there are people relying on you; if you are in this situation there are places such as legal aid centres, bankrupt attorneys and credit counsellors who can help you find a way to get out of financial trouble with paying.
Claiming bankruptcy could be an option but this should always be discussed with a professional attorney.
What Can A Lender Do If You Do Not Repay?
When you are behind in your repayments, your lender can legally take action against you. This can include enforcing wage garnishments, lawsuits and debt collections.
After the agreed period to repay a loan and no agreement between the two parties for a later repayment, the lender can implement any and all of these actions in order to gain the unpaid funds.
Withdrawals from your bank account is another option that lenders could take to get the money from you; court and jail has happened in the past but it is unlikely, especially if the lender finds the means to obtain the unpaid money.
What Punishments Could You Face For Not Repaying A Payday Loan?
There are a few more severe punishments that you might face for not repaying a payday loan. If lenders are struggling to obtain the fees from you and they do not have a collateral or any guarantors, then they might look to more severe consequences in order to obtain the money that is owed.
This could include being summoned to court. If you become uncooperative with the repayment structure then they may take you to court for not repaying. This can even be for a small amount of money; it is always in your best interests to turn up to court if you have been summoned so that you do not end up owing more money than you should have done.
In extremely severe cases, jail time has been issued in the past. This is highly unlikely and usually the biggest consequence of not repaying your loan on time will be that it will negatively impact your credit score hugely and you will end up paying more money that you originally had to.
Always make sure you understand how and when you can repay your loan before taking out a payday loan!