Beware of Personal Loan Default – There Could Be Jail Time

Understand that personal loan default consequences can make personal loan default liable for jail time and punishment with court case and penalty. Loan Singh provides instant approval on personal loan.

 

Hey Guys, How’s it going?

News of Salman Khan being sentenced to 5 years jail time for shooting a blackbuck has gotten trollers busy. Many debate that in order to get a jail time one needs to shoot an animal, whereas the PNG Fraud, allowed the perpetrators to flee the country possibly on bail. One thing to note is that in case of the PNB Fraud fiasco, clearly a number of flaws were exposed in the banking system. But, in the case of the aforementioned superstar, justice was served.

This made me think about the defaulters who take it easy when applying for a personal loan and defaulting on their EMIs. Many observed that, “Udhar koi 11000 Crore ka scam karke azad ghoom raha hain, aur idhar ek lakh tak default karenge to jail milti hain”.

So let’s dig deep into the matter of personal loan default and see what the consequences of personal loan default are and how you prevent it.

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Personal Loan Default

Yes! There is an act that governs the procedures to be undertaken when borrowers default on their credit obligations. Less than a month ago, there was an ordinance that was amended onto the Banking Regulation Act. This ordinance empowers the RBI (Reserve Bank of India) to initiate bankruptcy proceedings against chronic defaulters. The inquiry would be held on a case-to-case basis compared clubbing them into a broader set of rules and guidelines. The obvious reason as to why the government wants to curb loan defaults is because of its heightened increase in recent years.

 

Understand that personal loan default consequences can make personal loan default liable for jail time and punishment with court case and penalty. Loan Singh provides instant approval on personal loan.

 

Inability to repay even a single online loan EMI can deteriorate your relationship with Loan Singh. Because we provide an online loan to only salaried individuals based on his/her credit history, we already know that the borrower is good at handling credit. Therefore, we do our best to remind, re-remind and then only reprimand personal loan defaulters. A loan default or loan delinquency is your failure to make loan repayments when they are due. Extended delinquency can result in a personal loan default. It is your failure to repay the loan as per the terms agreed between you and Loan Singh.

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Loan Default Consequences with Loan Singh

The operations team at Loan Singh is a team of individuals that not only work miracles in getting your loan approved within minutes but also follow-up on defaulting borrowers. Our team will send you reminders for making your loan EMI repayments before the due date. In case you default with the loan EMI repayment, you will then receive preliminary reminders to pay the EMI along with late fees. The penal interest is not charged out of thin air. It is an amount you already agreed to pay in your loan agreement. Further proceedings depend upon your approach to the issue. Reasonable time is provided to the borrowers to repay along with the added charges.

For an unsecured loan, i.e. a personal loan, your credit score is sure to get damaged and Loan Singh is liable to take legal action against you. Therefore, defaulting on a personal loan comes with heavy consequences. The specifics depend on your situation, as in why you defaulted. But, it will usually be preceded by damage to your credit score and an additional penalty.

 

Understand that personal loan default consequences can make personal loan default liable for jail time and punishment with court case and penalty. Loan Singh provides instant approval on personal loan.

 

At Loan Singh, your credit score will not only get affected, your chances of availing a second loan with Loan Singh will disappear in smoke. Missed payments will be reported to the credit bureau. This will hamper your credit score and impede any loan application attempts in the future, not just with Loan Singh, but any bank as well. Traditional lending solutions (such as banks) recruit collection agents to collect the default amount physically (as per cash agreement format) or debiting the amount from your account. Defaults also increase your late payment fees, penalties, and legal expenses.

Jail time for personal loan default! Yes! There could be one if you fail to subsequently repay the loan. Under Section 420 or Section 403 of the Indian Penal Code, you could face jail time if a money recovery suit is filed on you by the bank/lender.

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Avoid Loan Default Tips

Banks handle a loan default differently. If the EMI itself a problem of default, they have the authority to reschedule the amount of EMI to be repaid. A loss of job due to unforeseen circumstances is understood by the bank. Loan Singh understands such travailing circumstances as well, but you need to communicate such dire situations to us ahead of time and not once monthly EMIs are continually defaulted upon.

 

Understand that personal loan default consequences can make personal loan default liable for jail time and punishment with court case and penalty. Loan Singh provides instant approval on personal loan.

 

For a home loan default, banks can restructure the home loan to help the borrower avoid a default. Sometimes, a bank can also convert an unsecured loan to a secured one. This can ease the burden of EMIs on the borrower. A one-time-settlement can be discussed with a bank, for borrowers who possess some capital and want to settle the loan if it suits both parties.

To ensure you escape the spiral of a personal loan default in the first place, we have some 4 tips to help you manage your finances better, thereby helping to avoid a default.

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  1. Prioritize debt payments

Ensure that you are extremely prompt while clearing loan EMIs and other credit-related payments.

With all these payments getting registered with credit bureaus, it is important that you pay-off these debt payments to prevent a negative credit history and also to prevent a fall in your credit bureau score.

Keep reminders on your phone or log in to Loan Singh’s dashboard to keep track of the due-date and impending EMI payments.

  1. Build a budget

A better way to control your finances is by creating a precise budget and sticking to it. A well-planned budget will help you prevent over-spending. Your budget should include all your expenses – big or small.

Tweak your budget according to the rise in your income. Revisit your budget every 6 months, at least. Although it can be difficult, especially if you have high spending habits ingrained, a budget should be your priority to make your personal financial management work. This includes loan EMI repayments.

  1. Track your expenses

Expense tracking is a habit that will ensure you keep track of daily, weekly or monthly expenses. This is important because in case you overshoot your budget, you won’t have the funds needed to pay the loan EMIs on time.

Keep track of your bank account balance, store all your bills, ATM receipts, invoices, etc. so that you can match these values with your expense tracker. The tracker can be a spreadsheet or a diary. Categorize the expense by type, date, and purpose. You will get to know how much you spent last week in restaurants or how much fuel goes into your motorcycle each week, etc.

  1. Rainy day funds

An emergency fund gives you breathing space during a financial calamity. It will prevent you from looking for other options to pay your loan EMI, as well.

Clearing a personal loan is a debt. It is best you clear only one instead of thinking of paying loan EMIs with your credit card limit.

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Loan Singh is a digital lending platform that prides in providing an unsecured online loan to salaried individuals. You can apply for instant funds with instant approval. An easy emergency loan can be availed in the form of a personal loan, which is not a bank loan. You receive a low personal loan interest rate. This instant loan, which is basically a quick loan, can be paid via easy EMI and can be availed for a number of loan purposes such as:

You can calculate your easy emi using our personal loan emi calculator. We accept bank statement, PAN, and Aadhaar for instant loan pre-approval. A bad credit score or credit report errors can lead to personal loan rejection. Personal loan defaulter consequences can also ruin your credit score. Improve your credit rating by avoiding emi repayment default. The ‘Loan Singh Blog’ is one of the best finance blogs in India.

 

Understand that personal loan default consequences can make personal loan default liable for jail time and punishment with court case and penalty. Loan Singh provides instant approval on personal loan.

 

Loan Singh’s Online Presence

Loan Singh is not an anonymous digital platform. We are present on almost all leading social media platforms. All you need to do is look for us. Some destinations you can find us on are:

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Understand that personal loan default consequences can make personal loan default liable for jail time and punishment with court case and penalty. Loan Singh provides instant approval on personal loan.

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