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How Can I Get A Loan With A Delinquency?
If you have been turned down in the past, you may be surprised to hear that you still have a chance at getting a loan. Many of the lenders in our network are used to dealing with credit issues, so even if you have been denied, there is still hope. Here is how it works.
First, you need to head back to the top of this page and fill out your quote form. Choose an amount that you would like to borrow and then add some basic details about yourself. Most people can complete there form in just a few minutes.
Once your form is complete, submit it to the lending network and wait for a speedy decision. If approved, one lender from our group will make you an offer and you will be sent to the lender website where you can review the loan details. Please take the time to thoroughly review your loan documents and make sure you understand all of the loan terms.
Next, all that is left to do is make your decision. Do you want to accept your loan offer or decline it? Accept it and you can have money in your bank as soon as the next business day. Decline it and you can simply walk away. There is no obligation in just getting a quote.
Dealing With A Delinquency
Hopefully, you were able to secure a loan offer with a delinquency and deal with your present financial position. Now, it is time to deal with that pesky delinquency. Here are some things that you should think about.
Understanding Delinquent Debt
Delinquent debt refers to any debt that remains unpaid beyond its agreed upon due date. However, being delinquent doesn’t necessarily indicate immediate trouble.
Many lenders offer a grace period which will allow a borrower to catch up on their payments without serious consequences or fees. This grace period is usually 30 days and may or may not incur a late fee. If a lender does charge a late fee during this period, a borrower can often ask for it to be removed. As long as the debt payments are back on track, this request is likely to be honored.
After this 30 day period, a delinquency starts becoming serious and will start to adversely affect the borrower. At this time, most lenders will begin reporting the debt to the credit bureaus and it will have a great impact on credit scores.
Consequences of Delinquency
The consequences of a delinquency generally increase as time goes on. The greater the amount of days late, the greater the consequences will be.
Initially, when a payment is less than 30 days late, your lender will send out a friendly reminder that you need to make a payment. 30 days is a rather standard grace payment term, but not all lenders will allow you to avoid late fees. Some lenders may charge late fees in as little as 7 to 10 days.
At 30 days late, consequences start becoming more sever. Nearly every creditor will report your delinquency to a credit bureau and most will charge you a late fee. With some lenders, this could be greater than 50 dollars. Additionally, some lenders, like credit card companies, may raise your interest rate. This is particularly common if you were given a special or introductory rate.
When you become 60, 90 or more days late, consequences start getting very sever. Reporting to the credit bureaus can drop your score dramatically and fees will begin adding up. You may start getting notices that a lender intends to accelerate a debt, which can lead to foreclosure or repossession. Lawsuits and, if your state allows it, wage garnishment can quickly follow.
Impact on Credit Score
The impact on your credit score can be dramatic and long lasting. A single 30 day late payment can drop your score by more than 50 points. Lengthier delinquencies can drop your score more than 100 points, in many cases. Even worse, these late payments will remain on your record for up to 7 years, even if the debt has been paid.
Avoiding Delinquency
Preventing delinquency on a loan is possible, in most cases, but requires you to be proactive.
First, you need to borrow responsibly. If you can not afford to make a payment, you should not take on an expensive loan.
You also need to budget to make the best use of your income. Your budget should include everything that you spend money on, even food and entertainment. Ideally, it would also leave room for saving 10 percent of your income monthly. If you make 4000 dollars a month, you should be saving at least 400 dollars out of it.
Finally, you should communicate with your creditors. If you run into trouble, do not ignore the phone calls. Instead, negotiate with them. You may be able to come to terms on a payment solution.
