There Is A Loan, But There Isn’t Any Money. What Should You Do
Some people, after taking out a loan, do not even consider the issue, “what should I do if I can’t pay?” This does not appear to be possible. Mortgage borrowers by law have the right to temporarily reduce or stop loan payments if they are in a difficult life situation.
Agree with the bank
Even if the collectors do not call you and do not write from the bank, this does not mean that they have forgotten about you and forgiven the debt. Interest accrues, the debt grows, credit history deteriorates. In addition, many banks prescribe in the contracts themselves that the borrower is obliged to immediately inform the bank that his financial situation has deteriorated so much that he will not be able to repay the loan on time. That is, if you do not pay and are silent, you thereby break even more rules.
How to negotiate with the bank
Prepare for the conversation. Gather all documents that may be the basis for a postponement or renegotiation of conditions. It is important to have on hand at least some documents confirming the difficulties you have encountered, and not just words that there is no money.
Should you take out a new loan to pay off the old one
In most cases, this is a bad decision. Firstly, you have already owed one bank, and you may not be given a loan in another. Or they will give, but with a higher interest rate than if you had no debt. If you grab new loans in a panic to pay off old ones, you can get bogged down in a debt hole.
I was laid off at work, I am sick. Will the law protect me
In the case of a mortgage, the payments on which usually eat up a large share of the family budget, the law gives you the right to a respite – a mortgage vacation. However, you may only utilize them once throughout the loan agreement’s validity period, and their maximum duration is six months.
If the bank has lost its license, do I owe nothing to anyone else?
No, your debt does not disappear after the bankruptcy of the bank, it goes to a third party – another bank/organization or the Deposit Insurance Agency. The debt will have to be paid, and it is important to keep your finger on the pulse: follow the news and do not stop paying the loan. New details for paying a debt to a bankrupt bank must appear on the website of the Deposit Insurance Agency – pay according to them and, just in case, save all payment documents. If you stop paying, waiting for official notification of the transfer of debt and a change in details, then in the end you may receive not only a letter of notification but also an impressive penalty for late payments.
Calculate your strength. The advice may seem obvious, but in practice, people often do not pay off loans, not because of crises in the country or problems in the global economy, but because they incorrectly assess their capabilities and take on obligations that they then cannot fulfill.