How to Tackle the Situation if You Default on Your EMI Payments
Mar 13, 2019 Home Loan
Unfortunate incidents can walk into our life without knocking on the door. Such incidents can cause us not only emotional and mental trouble but also financial trouble. Falling into such pit is not in our hands but how we handle such situations defiantly are.
If you are paying monthly EMI and any such situation occur where you are not able to pay back the loan amount, there are things that you must do to avoid your bank taking an extreme step against you.
We discuss them below:
If you are paying monthly EMI and any such situation occur where you are not able to pay back the loan amount, there are things that you must do to avoid your bank taking an extreme step against you.
We discuss them below:
Take their calls:
If you have defaulted on your payment, the banks will send you email and reminder calls regarding the same. Avoiding the calls will make the banks more suspicious, and the trust they have over you will be questioned. Attend those calls and replay to the emails. Avoiding the bank or the loan lender will do you no good.
Communication is the key:
Communicating with your bank can help solve your problem to a great extent. If you have landed in the situation where paying EMIs are difficult then inform your bank about the same. Keep them in the loop from the beginning. The bank or loan lender will have a solution to what they can do with your EMI. They might even grant you a holiday period where you are free from paying any EMI for a few months. This can help the borrower to find a fix to his situation. Keeping them informed from the beginning will only help you in a long way.
What are the other options?
Most of the borrowers have the mindset that defaulting on any EMI will force the bank to auction your house. But it is not true. Auctioning the property is generally the last resort when even the banks cannot find any other way to get their money back.
When you inform the bank about your financial dilemma, they can give you some few options to deal with. You can have the choice to stretch your home loan tenure which will reduce the monthly EMI. Otherwise, the bank can offer you the holiday period, and you can pay a bit more EMI after the holiday period ends.
If the situation is bad and there is no sign of any improvement in future. In such a case, the bank takes a lump- sum of money from the borrower and settles the matter. But keep in mind that this will reflect in your credit report and this can affect you from taking any other loan in future. The bank or loan lenders will hesitate before approving your loan.
When you inform the bank about your financial dilemma, they can give you some few options to deal with. You can have the choice to stretch your home loan tenure which will reduce the monthly EMI. Otherwise, the bank can offer you the holiday period, and you can pay a bit more EMI after the holiday period ends.
If the situation is bad and there is no sign of any improvement in future. In such a case, the bank takes a lump- sum of money from the borrower and settles the matter. But keep in mind that this will reflect in your credit report and this can affect you from taking any other loan in future. The bank or loan lenders will hesitate before approving your loan.
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