What will happen if a person cannot pay a huge amount of personal loan?
Franziz R asked:
A friend of mine has a $20,000 equity and $40,000 personal loan in the bank and was not able to pay a single amount because he was laid off from his job. What do you think the bank will do to his property and to him?
Susan
A friend of mine has a $20,000 equity and $40,000 personal loan in the bank and was not able to pay a single amount because he was laid off from his job. What do you think the bank will do to his property and to him?
Susan
Tags: Job, Personal Loan
May 29th, 2009 at 12:38 am
Janet
They will repossess the collateral (house, car, etc) that he placed on the loans.
They will take him to court to recoup the difference between the collateral’s actual value and the amounts of the loans.
Finally, his credit will be shot.
I would suggest he get himself a lawyer to see if there is a way out…bankruptcy perhaps??
May 31st, 2009 at 5:52 am
Ellen
Eventually the bank will get whatever was used as security and your friend will have ruined his credit.
June 1st, 2009 at 9:11 pm
Benjamin
Firstly, harassment
Secondly, Credit Rating will drop to nothing
Thirdly, extreme harassment from collection agencies and then most likely attorney’s office that represent the lender.
Fourth, lien put on property, or at the most extreme, foreclosure.
Your friend has the option of bankruptcy if things start getting out of hand. Let him know that if he chooses this option, his credit rating will always be tainted and buying a new car, loan, house, etc. will always be harder
June 5th, 2009 at 4:38 am
Vernon
They will take the property that he used to secure the debt. If it was secured by his house, they will sell his house from under him. If it was his car, they will repo it. The bank will get its money however they can.
June 8th, 2009 at 12:38 am
Andre
Hi,
The only option before him is to file bankruptcy. But, before doing it he should explore the possibilities of debt consolidation. This will give sometime for him to find some other ways to repay the loan. He has to be hopeful that he could find a job in the meantime and start repaying his old dues. Check out for some useful info and tips. Good luck!
June 8th, 2009 at 7:30 pm
Alicia
all the bank can do is report no payment to the credit bearus… he will end up haveing bad credit,