I took out a personal loan last year and always make sure to pay them on time. However, just out of curiosity, I wanted to know what happens if personal loan EMI is not paid on time. I started doing some research and learned that one of the biggest problems that raises is the dip in credit scores. Not paying EMIs on time affects your credit score by a lot.
What Happens if Personal Loan EMI is Missed?
As I mentioned above, your credit score is affected when you don’t pay your EMIs on time. When that happens, lenders think you are not creditworthy and are less likely to provide you with a loan. Here are a few more things that I have learned.
Additional Interests and Penalties
Not paying your EMI on time quite results in lenders penalising you with additional interest. This increases the overall cost of your loan. Delayed payment keeps on adding to this amount, thus increasing your financial strain.
Health Impact
Another result of missed EMI is debt traps. These may look like nothing at the beginning, but over time, it affects your financial well-being. This can lead to stress, which can affect your mental and physical health.
Legal Action
Repetitive missing EMIs can lead to lenders taking legal action against you. This could also lead to court proceedings.
This is what will happen if personal loan EMI not paid on time. And that is all that I have learned. I hope this helps.
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Authors Of The Question
What Happens if Personal Loan EMI is Not Paid?
Animesh
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1 Answers
59 days
2024-10-28T23:09:48+00:00 2024-10-28T23:09:49+00:00Comment
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