Once the loan has been paid into your account if at any time you fear you will not be able to make a payment you must get in touch with your lender. They may be ale to help by rescheduling repayments meaning you do not face any adverse actions. Changing the terms of the loan like this may incur further costs however but only you and your lender can discuss this. If no attempt to contact the lender is made then they have every right to involve a third party debt collecting agency.
Most lenders also reserve the right to utilise the Continuous Payment Authority. This means they will continue to attempt to take the money owed to them from your account for up to 90 days after the missed payment. Check your Terms and Conditions.
Non Payment Implications
If you don’t pay it will impact your credit report. This means you will struggle to get finance and credit in the future. In addition to this charges will be placed on your account which will have to be met at a later date. Basically, not paying and ignoring the problem will mean you pay more in the long run.
Usually lenders will try and contact you via the phone or by letter to recover funds. Struggling? Contact the lender immediately.
Not paying your loan back will result in the lender reporting your case to the Credit Reference Agencies. Again, this will impact your credit score and in future may impact purchases.
If you do default you are likely to be charged a collection fee and you could even be charged any reasonable costs incurred in enforcing your loan.
Loan Renewal Policy
There is every possibility your lender will be willing to renew your loan. The lenders we work with often offer similar or even better rates to people who have paid back loans in the past. But remember to take care that you can afford the loan. You must be able to repay it.