In today’s time, people realise a lot of their financial dreams through loans. Be it buying a house or a vehicle, or starting a business, big tasks can be accomplished with the help of a bank loan. But the loan also has to be repaid along with interest.
For this, the loan installment has to be paid every month at the stipulated time.
If the installment bounces, it can be a big problem for you.
When your installment bounces for the first time, a penalty is imposed by the bank.
If two EMIs are not paid consecutively, a reminder letter is issued by the bank.
If the EMI bounces for the third consecutive time, the bank takes a strict stance and counts your case as Non-Performing Asset (NPA).
Simultaneously, the recovery process starts.
Apart from this, your CIBIL score also deteriorates due to the bounced EMI.
If you too are facing difficulty in repaying the loan EMI on time, know here the ways to save yourself from big trouble.
Talk to manager
If the EMI has bounced by mistake or due to some compulsion, then first of all, go to the branch of the bank from where you have taken the loan, meet the bank manager, and explain your problem.
Assure them that this will not happen in the future.
In such a situation, the bank manager will advise you not to do this in the future and will ask you to pay the next installment on time.
Meanwhile, even if a penalty is imposed by the bank, it will not be so much that you cannot pay it.
At the same time, if you feel that you will not be able to pay the loan EMI for some time, you can request to hold the EMI for some time.
For this, you will have to apply. After some time, when the money is arranged, you can pay the amount. This will give you some relief in difficult times.
Arrear EMI option
If your salary comes late and you are not able to arrange funds till the EMI date, and due to this, your EMI gets bounced, you can talk to the bank manager for the arrear EMI.
The loan installment date is usually at the beginning of the month, this is called advance EMI.
Most of the loan borrowers are given the option of an advance EMI.
But if you want, you can also take the option of arrear EMI.
In this case, you pay your installment at the end of the month.
Ask for CIBIL Score
If the installment is bounced for three months, the bank manager sends a report for CIBIL score.
If your loan has been bounced for less than this period, you should request the bank manager not to send a negative report in your CIBIL.
If your CIBIL score is bad, you may face difficulty in taking a loan next time.
Talk for loan settlement
If you have taken a loan but after that, the situation gets changed and you are not able to pay the loan installment, in such a situation, you can meet the bank manager and talk to the loan settlement.
However, the bank will ask you the reason for this, if your answer is reasonable, only then your request will be accepted.
During loan settlement, negotiations take place between the borrower and the lending bank and after both agree on a certain amount, the borrower has to pay the settled amount of the loan in one go.
In banking language, it is called One Time Settlement.