What to do if you miss a personal loan repayment?

A personal loan is a popular and convenient financing option that helps you meet your financial obligation. Its simple features and high affordability has allowed borrowers across all income segments to meet their varying funding needs with ease. While availing an instant loan has become easier today, managing a personal loan has also become more important than ever.

The consequences of missed EMIs can be grave. It not only adds the burden of penalty charges on your cash loan but also affects your credit score negatively. Missed EMIs on the scheduled date also reduce your eligibility for future borrowing. This may lead to rejections of your future loan applications or credit card applications. The record of missed payments stays on your credit report forever. Hence, it is very important to manage your personal loan debt well.

Read on to understand the impact of missing your personal loan repayment and the smart steps that you can take to reverse the effect of missed loan payments.

The Impact of Missing Personal Loan Repayments

Missing out on your personal loan repayments can have grave consequences on your borrowing profile depending on how many repayment schedules you have missed and by how many days.

In case you have missed your repayments by a day up to 30 days as per the scheduled due date, the lender may allow you to complete repayment along with a penalty or fee levied at a nominal rate. In case you inform the lender of a delay, they may even agree for providing a grace period for such repayment.

If the delay goes up between 30 and 60 days, this may lead to a significant negative impact on the borrower’s credit score. Also, a late fee is levied on the delayed amount when paying. If the delays are between 60 and 90 days, your credit score can take a major hit and lead to a severe impact on your future prospects of borrowing. For delays beyond 90 days, the lending institution may prepare to take legal action for recovery of the loan.

Thus, if you delay your EMI payments by less than 90 days then it is marked as minor default. In this case, your lender will levy a penalty charge, send multiple reminder notices and report the delay to the credit bureaus. This will affect your credit score. But if you delay your EMI payment by more than 90 days, then it is considered a major default. In such cases, your lender will mark your loan as a non-performing asset (NPA) and they may initiate the recovery process. But before marking your loan as NPA, the lender will send you multiple intimations.

Things to Do If You Miss Your Personal Loan Repayment

In case you have missed out on your instant loan repayment, here are the steps that you can immediately initiate.

  • You must immediately contact your lender and state the reasons for your delay. Further, you also need to chart out a repayment plan for the loan with your financial institution so it does not leave any major impact on your credit profile.
  • You may request your lender to restructure your loan. This will bring you some relief and help you get your finances back on track.
  • You can also opt for a loan transfer and avail a new loan against your investment or insurance. You can also pledge your personal assets like gold, fixed deposits, stocks etc. and avail a new loan with a reduced interest rate, longer tenure and lower EMI.
  • You can also sign up for a debt management plan with your lender. It ideally involves rescheduling the repayment dates to align with your financial standing.
  • If the delays have been long and you lack the necessary funding to meet the scheduled repayment liability, then you can look for a suitable debt consolidation loan. This loan may come with a high-interest rate as the risk associated with the borrower’s profile would be high for the lender.
  • You can also approach a debt counsellor for advice on your debt management. You can also get in touch with your lender and talk to them directly.
  • If missed repayment is not your fault like the auto-debit facility did not get initiated. Then talk to your lender and ask them to waive the penalty.


These are some of the most effective resolutions in case you have missed your EMIs. However, the ideal solution is to be very regular with your repayments. While applying for an instant loan you must sketch a solid repayment plan. You must also keep money worth 3 to 6 months of EMI in your account to take care of your EMIs in case of a crisis. Repaying your cash loan in full and on time is highly recommended.

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