Your payment history makes up about 35 percent of your credit score. If you want to improve your credit score or apply for more credit, making payments on time is important.
Even if you used a loan calculator to make sure you could handle the personal loan online, things change. You may become unemployed or an accident may mean you have large medical bills. Unexpected events like this affect your ability to pay.
What happens if you find yourself unable to make a bad credit loan payment? We have a few tips you can try.
Make a Loan Payment as Soon as You Can
If you can’t pay the full amount immediately, ask yourself if you can make a partial payment on time. Another option is a late payment. While neither option is ideal, paying late is better than not paying at all.
The situation is different if you don’t know when you’re going to be able to make a payment. You’ll want to think about some of these other options.
Try Debt Consolidation
If your debt load is quite high, you may be making several payments to different sources of debt. Some people have more than one credit card, plus a personal loan no credit check or an auto loan. You might have a mortgage or a student loan too.
In this scenario, you’re probably paying different interest rates as well. Debt consolidation installment loans could make it easier for you to manage your loan payments. A secured loan, which uses your assets as collateral, may be an option for consolidating.
Try a loan payment calculator and see how much consolidating your debt could save you. Since you’re paying one interest rate, your payments may actually fall. This is especially true if you have high-interest debt, such as credit card balances.
Making one payment once a month may also be easier to plan for and manage. This is especially true if you get paid infrequently, such as on a monthly basis.
Talk to a Credit Counselor
If you’re looking at debt consolidation, you may be talking to a credit counselor anyway. These professionals can help you create a debt management plan.
They’ll also communicate with your creditors on your behalf. They may be able to offer advice, as well as helping you explore your options for managing your debt.
A credit counselor can also tell you about your rights. They’ll help you understand your loan contract.
Communicate with the Lender
If you’re struggling with your loan payments, one of the best things you can do is talk to the creditor themselves. While you may not want to, discussing the situation with them will likely reveal options you didn’t know you had.
Many lenders have forbearance programs. Some programs are temporary in nature. Others are designed to address more long-term issues.
An example would be an accident that left a wage-earner in your house unable to work. An event like this would significantly reduce your income.
Talking to your lender early may allow you to get temporary relief during a tough financial time. If your circumstances have changed, you may be able to have part of the principal forgiven.
If your account becomes delinquent, you may be able to reach a settlement. This isn’t your best option since it means your credit score will take a hit for non-payment.
You Have More Options
Not being able to make a payday loan online payment is a stressful situation. Luckily, you have more options than you may have realized.
If you need help finding the right loan to manage your debt, check out our blog. We have plenty of informative articles to help you manage debt and get back on top of your credit. Here are some other articles you might find interesting: