You made a payroll loan or a credit operation and saw that you will not be able to pay. The first question that goes through your mind, of course, is “I made a loan and did not pay… what happens now?”.
Failure to pay a debt has some consequences for the debtor. This text will explain to you exactly what happens now. Here are some of the consequences of not paying your loan.
If your question is “I made a loan and did not pay. And now? “, Know that if you let the debt due date pass you will receive a debit notification. Then you will have a period of 10 days to pay off the amount due.
After this deadline, according to the Consumer Protection Code (CDC), you may get the dirty name on the market. You will be denied in institutions such as the Credit Protection Service (SPC), Serasa or in notary offices for five years or more.
With the name dirty, your situation will become even more complicated. The banks and other institutions will know that you owe and, with that, will hesitate to offer you more lines of credit.
That is, it is like a snowball. You do not have the money to pay your loan, it gets its name dirty, and it becomes even more difficult to get funds to pay off your debt. The dirty name will also give you difficulties to rent a property, open a bank account or even make purchases on time.
Reduction of Credit Score and Score
A credit score is a rating calculated based on your credit history. Banks, financial institutions, and stores consult your score to decide whether or not to approve a credit request you make.
The Credit Score is another credit rating indicator, used as a parameter to determine the likelihood of you do not pay the loan contracted.
These indicators guide the assessment of financial institutions on the granting of a loan to you.
So, if you fail to pay off a debt, your credit score will be reduced. With this, you will have difficulty finding the same credit limits and deadlines that were previously offered.
So for those of you with the question, ” I borrowed and did not pay, and now?”, Know that your score has certainly declined.
Here’s how to increase your score.
Unwanted phone calls
When the installments of a debt are not paid for a long time, there is the possibility that the creditor institution sells the debt to another company. This new company pays a cash value to the current lender and takes over the debt for himself, with the right to charge the debtor.
This type of company works precisely with debt collections. Their methods include constant phone calls to your home and cell phone – on any day and at any time.
Until you settle the debt with this new lender, you and your family will continue to receive persistent collection phone calls. That’s because these companies are specialized in this.
Property or vehicle taken
In the case of a secured loan, there is a concrete risk of losing the asset offered.
In this type of loan, the person offers a property or vehicle as collateral. It signs a contract that provides that in case of default, the offered good can pass to the bank as payment of the debt.
There are advantages in offering a property or other asset as collateral to take out a loan. Because of this guarantee, it is possible to negotiate with the bank interest rates well below the normal percentages practiced in the market.
The disadvantage is that if the person delays the installments a lot, there is a possibility that the bank may request the offered good as collateral to repay the debt. Although this is the last resort, this possibility is real.
Worse still: in some cases, the person, in addition to losing the good offered, still needs to pay the balance due!
Problem for the guarantor
A guarantor is a person who guarantees the payment of a loan taken by a trusted friend.
Thus, in the case of loans with collateral, in the occurrence of default, the bank or creditor institution will seek the guarantor who signed the contract. The goal is to charge you the loan debt.
This is undoubtedly an embarrassing situation. Most of the time the guarantor is friend of the person who took the loan. Failure to pay off the debt may cause the friendship between the two to shatter.
How to solve the situation?
Well, we have already listed some of the answers to the question “I made a loan and I did not pay… what happens now?”. So let’s keep talking about what can be done to solve the problem.
When you are no longer able to pay the monthly installments of your debt, the best thing to do is to seek the bank or lending institution to talk.
Show that you have an interest in repaying the debt, and propose a renegotiation. To do this, present data as proof of monthly earnings and expenses, and try to negotiate new interest rates.
For the creditor institution it is more convenient to renegotiate the debt, establishing new deadlines and rates. This is always more advantageous than running the risk of not receiving any money.
This also occurs in secured loan cases. It is much more advantageous for the bank to renegotiate the debt than to trigger its legal body to enter with a process of materialization of the good offered as collateral, to take it from the person.
Legal proceedings are expensive and time consuming. As a result, banks are usually willing to talk to debtors to try to reach an agreement, before resorting to extreme measures. So, do not hesitate: seek your creditors to renegotiate your debt!
What happens then if I made a loan and did not pay?
Briefly, you will be denied in SPC and Swera, getting the name dirty. This means that you will have difficulty making other loans or credit operations. Other than that, if you have offered a good as collateral for the loan, it can be taken over by the bank, which will auction you off to pay off your debt.
There is still the possibility that you may be sued by your creditors. That will probably take you plenty of time, and money, for lawyers.
But for one thing you can rest easy: you will not go to jail. Brazilian law does not provide for arrest for non-payment of bank debt. The only situation in which the person can go to prison is in the case of non-payment of alimony.
But that is no reason to be owed! Here are tips to try and clean your name as soon as possible.