Various credit facilities are nowadays easily available for borrowers. But situations do arise when borrowers fail to repay the dues on time, becoming a liability for the lender/bank.
Skipping payments once or twice may not catch your attention as being serious, but as time passes, this creates a heap of debt that people fail to settle on time and hence becomes a black mark in their Credit History.
Another interesting point to note is during the initial days of missed EMIs the collection team remains mild and doesn't make aggressive efforts to recover the dues. However with time, they become proactive and create problems to recover the dues in whatever way possible.
So, if you are in this stage and are planning to clear your past dues, this article will tell you how you can clear the dues without hassles and lead a debt-free life.
So, let's discuss ways to clear your past dues with the bank without delay.
Pay the Entire Past Dues
The simplest and most practical solution for the borrowers is to pay their past dues in a single go. This is the simplest (but hardest!) way to bring your dues to an end and permanently clear all your pending dues in a single attempt. If you clear the pending dues within 30 days of your initial due date, you can save yourself from damaging your CIBIL score.
This may sound simple but not everyone has enough funds to clear the past dues in one go. Clearing past due is simpler if you have just skipped one or two payments.
Catch Up on Your Pending Dues in 3-4 Months:
It's obvious that if you have missed a few payments in the past, you won't be financially prepared to pay them in a single attempt. Even if you get some funds to clear the past dues, it won't be possible to pay 100% of the entire pending debt. Hence, you can reach out to your creditor and request to pay-off the pending balance in 2-3 months. This way, you will find it easy to continue paying the ongoing EMIs and settle the pending dues over a few months. This will save you from amassing a massive financial burden in one month. In short, getting support from your creditor will help you catch up to the ongoing EMI and maintain it for zero-delay payments.
You must note that even though you have started paying off the past dues in portion, you will still have the outstanding dues mark on your CIBIL report until your over-due amount is fully cleared from your end.
Consolidate Your Loan Account:
If you have an existing loan account alongside the loan holding past due, loan consolidation can work best. Consolidation of your loan won't help you get free cash to settle your debts. Instead, it gives you the option to pay off the overdue account and clear the account. Moreover, the prime purpose of using a consolidation loan account is to clear all your existing loans and bring them all under one umbrella.
Debt consolidation is good when you have overdue accounts alongside other ongoing loans. This gives you freedom from remembering different EMI amounts and their deduction dates. It clears all your ongoing loan accounts and packages them into one debt consolidation loan that becomes easy to handle.
You can also extend the repayment timeframe to make it easy based on your ongoing budget planning.
Settle Your Account:
If you know that paying past dues isn't possible, you can try reaching out to the creditor and requesting to settle the account. With account settlement, you can pay a lower lump-sum amount to the lender/bank and zeroize your loan account. However, not all lenders/banks agree with your request.
Moreover, a "Settled" status will be added to your CIBIL report after you settle the account. For more on settling your loan click this link.
Talk to a Credit Counselling Agency:
Nowadays, there are a few credit counseling agencies can help you manage your existing loan accounts and past dues. These agencies may be able maintain your reputation and CIBIL score with the right and most practical payment option. You should work with them to find a concrete and effective option to pay for the past dues and settle everything with the bank. For more on CIBIL improvement agencies in India, click tis link.
With the above options, you can perhaps pay your overdues with the lenders and lead a happy financial life.
Those who want to stay away from these kinds of hassles would do well to follow the below-given tips.
Always Prepare Your List of Bills: Before the month starts and you start your monthly expenses, it's better to prepare a monthly budget, including all the bills and EMIs.
Know Your Loan Accounts: You should never miss out on your loan payments. Hence, you should know the loan accounts and their payment date. This will help you maintain enough funds in the account before the deduction date arrives.
Calculate Your Total Debt: Your monthly budget must include a fixed portion for the loan repayments. It means you must know all the EMIs and the total amount that's necessary to ensure zero-delay loan payments.
Set Up Automated Payments: Nowadays, all banks provide you automated payment options that auto-debit your account with the loan EMI. This saves you time and effort in remembering the amount and date for specific loan payments.
Now, these tips will help you to make timely payments on your loans and cards and stay away from payment delays, CIBIL defaults and the mental agony of going through the none too attractive options of how to clear your over-due loans.
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