Things don’t always go the way we want. The inability of paying the loan on time can be daunting, if there comes a situation like that it’s better to take action sooner than later. This way you can reduce the harm done to your finances and you have less stress when dealing with this and prevent it from getting even worse
The answer in some cases can be easy, you can sell one of your assets like gold or a vehicle to settle your debt but things are not that easy all the time.
In the worst-case scenario what happens when you don’t pay your debt, one thing is you will have to pay more this would include the interest and many other penalties which may take a lot of years to finish off and recover.
What to do when you realize you can’t pay
When you realize you can’t pay in most situations you may actually have some time left before your next payment within which you can do many things to save yourself
It is always to pay the loan on time if you can’t do so you can pay a little late, try to pay your loan 30 days of due date. If it can be done within 30 days in most cases this is not even recorded in the credit bureau and your credit won’t be damaged.
Consolidate the loan
This is to borrow money to pay off your other debts. You can obtain quick loans online same day to pay the loan. This is especially worth it and better if you have to settle off credit card or payday loans which are usually high interest and delaying them would only lead you to further trouble, getting personal loan with low interest to pay these off is a good idea because you have more time to settle off personal loan and the interest rate is low.
This is to obtain a loan while leaving your asset as collateral. This could be risky because you can end up losing your asset if you cannot pay on time. For example, you can get a loan by pledging your house or your vehicle but if you are unable to pay them you can end up losing your house and vehicle which would ultimately bring distress to you and your family.
Talk with the lenders
If you think that you might have some difficulties in paying it’s better to talk to the lenders and explain your situation, they may be able to help you with some other options. They may extend the time or allow you to skip payments.
Ask for help
You may think that just because you are in some difficult position you can’t get help, there are people who are there to help people like you. Credit counselling can help you with understanding the situation and coming up with a solution, sometimes hearing an opinion from outside can help.