Apart from sourcing funds, taking a personal loan also entails timely EMI payments to a lender. Now, what if you have every intention of paying off your loan on time, but unpredictable circumstances in life cause hindrance in doing so?
Don’t fret! You can keep up with your personal finance repayment schedule by following the steps listed below.
#Step 1 – Stay calm and composed
Under pressing circumstances that may lead to personal loan default, your first reaction could be that of panic; however, stressing out will only make matters worse. Collect yourself and figure out the reason for missing out on loan repayments.
#Step 2 – Talk to your lender
One must never underestimate the power of communication. So, do not hesitate to talk to your lender, explaining the reason for defaulting on personal loan repayments. Your lender may come up with any one of the following solutions –
- You may be allowed more time to pay off your loan.
- Your lender may restructure the loan – Though they cannot change the personal loan interest rate, they may increase the loan tenure.
- In the worst-case scenario, you can request the lending institution for a settlement.
Additional Read: Ways to Plan Personal Loan EMI Repayment Smartly
#Step 3 – Consider refinancing the loan
Another way out is to opt for loan refinancing. This way, you may be able to reduce your personal loan EMI. Refinancing is simply shifting your existing loan to another lending institution provided they offer a lower rate of interest. However, you need to ensure you have a good credit score to be able to refinance your loan amount.
#Step 4 – Look for ways to increase income
To deal with defaulting on personal finance EMIs, you can consider looking for other income sources; take up short-term jobs such as freelancing projects to help you secure more money. However, if that is ruled out, an alternative would be to look for ways to budget your existing income. Cut back on unnecessary expenses, make use of mega-sales and coupons for purchases, cut down on unnecessary travel, etc.
#Step 5 – Sell something of value
To pay off your personal credit or loan, you can consider selling some item of value such as a piece of art, jewellery, etc. If that is not possible, there is another way. We often have unused items lying around. This includes anything – from books to toys. Consider selling them off and using the money towards loan repayment.
Additional Read: Tips to Repay Personal Loans without Affecting Your Wallet
Avail personal loan online from Tata Capital – we offer personal credit or loan at attractive interest rates, flexible repayment terms, and relaxedpersonal loan eligibility criteria.
Not sure of the kind of EMI you will be liable to pay when you avail finance from us? Don’t fret! Simply log on to our website to use a personal loan EMI calculator to figure out your potential monthly instalment. To know more, get in touch with us today!