Banks go to court for non-payment
If you’ve defaulted on a loan, you’re not alone. COVID-19 left many Pinoys unemployed and businesses shuttered, and other factors can add up to stress and tight financial circumstances. Medical emergencies, unforeseen events, and rising costs can add up to stress and a delinquent loan. Put off making the payment until you can make it without stress, but if you don’t, the default could only cause your financial situation to get worse.
Borrowers can be fined
If an online loan is not paid in the Philippines, the bank can take the troubled borrower to court to recover the debt. The lender has three years to bring the troubled borrower to justice and take back any property that is the subject of unpaid debts. The borrower is also subject to jail time if he fails to pay the debt. The court may impose fines if he does not pay the loan on time.
There have been several cases of borrowers being contacted by collecting agents for failing to repay online loans. One such case involves a Chinese national, 45 employees of a lending company, and several others. The Chinese national was arrested after he allegedly threatened clients on the phone and harassed them through emails. Despite the firm’s assurances that it does not encourage harassment, one suspect said he was unaware that he had given his own personal contacts to the company.
You can go to jail for non-payment
It’s no surprise that people are scared of going to jail when they don’t make Digido loan payments in the Philippines. In fact, lenders often don’t tell their borrowers about late fees or the penalties that can be charged if they don’t pay on time. The best way to avoid getting into trouble is to avoid applying for any loans in the first place. This may be easier said than done, but it’s crucial to your financial wellbeing.
Fortunately, there are ways to avoid getting into trouble with debt collectors in the Philippines. First, be aware of your rights. Many countries have laws against incarcerating people for debt default. This is a violation of international human rights and violates the terms of the Philippines’ International Covenant on Civil and Political Rights. In addition, you can still accrue interest on your debt despite the fact that you are not paying.
What to do if you can’t pay on time
When you realize that there will be a delay this month, contact the lender. Experts can offer several options for resolving circumstances.
Loan restructuring
This is an opportunity to renegotiate a loan agreement with new, more favorable terms. For example, you can increase the repayment period by several years or reduce the interest rate on the loan. Then the monthly payment is reduced to a more comfortable one for the debtor.
Loan refinancing
This is the transfer of a loan to another bank that can offer better terms than the previous one.