Loans, what happens in the event of insolvency?

Personal loans

Personal loans

Personal loans are a form of financing useful for obtaining liquidity when you are in serious difficulties or if we have to face sudden and urgent expenses. The credit is provided by a bank or a specialized financial institution, through which a customer receives a sum of money and undertakes to return it in installments and within a set period. According to experts, this new financial commitment must always be carefully considered, taking into account your family spending budget and your monthly income. It is advisable to evaluate both the total cost of the loan and the installment to be borne by the beneficiary: the installment is added to the other burdensome commitments, such as rent, bills, and other loan installments.

Difficulties can arise not only when we require large sums, but also and above all when we accumulate the numerous and small expenses that together weigh and have a certain consistency. It is precisely in these cases that the risk of insolvency increases for those who have benefited from the personal loan. This situation varies depending on the financial institution that provided the loan and the importance of outstanding credit. When deciding to take out a personal loan, you must always be sure that you can meet your commitment. The consequences may in fact be patrimonial, penal and affect the possibility of obtaining other forms of credit in the future. We need to be able to pay every single monthly payment because sometimes even one unpaid installment is enough to default.

Installment of the loan

Installment of the loan

If we have requested the loan through a guarantor, in the event of insolvency of the installments, it will be this third person who will have to provide for the repayment. The penalty is in fact the registration for the same guarantor in the databases that indicate the missed payments of one or more installments of the loan. Each bank obviously behaves independently and differently. Sometimes we start from a default that provides more interest on the unpaid installment. Others, on the other hand, are already reporting to the Central Risks (CRIF) as “bad payers” . Once you enter the black list, up to 36 months after the expiry of the loan agreement no one will be more inclined to grant you a credit. The databases are in fact always consulted by the credit institutions before proceeding to the disbursement of a loan.

According to experts, when it is expected that it will be difficult to meet the deadlines – even for one installment – it is very useful to immediately contact the bank or intermediary to find alternative solutions. The banks have devised methods for repaying installments capable of satisfying the needs of many customers, such as the possibility of skipping an installment, varying the amount thereof, lengthening or shortening the repayment plan according to the transaction. It is also important to promptly report to the financing body any change of residence, so that the communications sent by the latter will arrive on time.

When, on the other hand, no one speaks of one or more unpaid installments, then the credit institution intervenes through external legal figures. Among the most sought after roads there are:

  1. L at the request of the fifth of the salary in the case in which you are workers or the deduction in pay envelope through attachment thus avoiding also the reporting of bad payer;
  2. If you do not work, which is quite unlikely, you will instead go to the attachment of your assets. In this case it will not be possible to avoid reporting in Crif;
  3. If, on the other hand, you have become inexperienced, the bank will not be able to recover its credit but for you it will be impossible in the future to have access to credit lines at any institution.

A different form of safeguard against insolvency risks is constituted by credit insurance. We are talking about life insurance policies, accidents or loss of employment, which ensure the repayment of the amount due in cases where the debtor finds himself insolvent for one of the causes covered by the insurance policy, such as: death of the debtor, invalidity , loss of employment. Obviously it is not possible to fix a valid set of terms because the possible request for guarantees against a request for a personal loan changes according to the individual financing institution.