{"id":10988,"date":"2023-08-29T02:38:09","date_gmt":"2023-08-29T02:38:09","guid":{"rendered":"\/blog\/?p=10988"},"modified":"2024-02-08T13:22:37","modified_gmt":"2024-02-08T07:52:37","slug":"what-happens-if-a-personal-loan-emi-is-missed","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/personal-use-loan\/what-happens-if-a-personal-loan-emi-is-missed\/","title":{"rendered":"What Happens if a Personal Loan EMI is Missed?"},"content":{"rendered":"\n

A\npersonal loan is an ideal choice of funding for borrowers who don’t want\nto pledge any asset as collateral with the lender. However, such loans come at\nthe cost of relatively higher interest rates. When you apply for personal loan<\/a>, you must ensure that\nyou’d be able to manage the monthly EMI responsibly without defaulting. <\/p>\n\n\n\n

A personal loan EMI calculator<\/a> available online lets you calculate the EMI amount you will have to pay each month against the principal for a specified loan tenure. You only have to enter the principal amount, loan tenure and the personal loan interest rate<\/a>. You can then plan your EMIs conveniently to repay the loan.<\/p>\n\n\n\n

Some EMI options available for personal loans include the following:<\/h2>\n\n\n\n

1. Standard EMI<\/h3>\n\n\n\n

This\nis the most common option wherein you can repay your loan amount inclusive of\ninterest every month. In a standard EMI, the rate of interest is charged on the\nprincipal.<\/p>\n\n\n\n

2. Flexi Interest-Only Loan EMI<\/h3>\n\n\n\n

This\nEMI option comes with a pre-approved cash limit that you can withdraw when you\nneed funds. The interest is only charged on the amount you have used instead of\nthe total principal amount.<\/p>\n\n\n\n

3. Step-Up Flexi Loan EMI<\/h3>\n\n\n\n

This\noption offers maximum flexibility; you can pay lower EMIs in the beginning and\ngradually pay more as your income increases over time.<\/p>\n\n\n\n

What happens if personal loan EMI is missed<\/h2>\n\n\n\n

There\ncould be times when you miss out on an EMI payment. This could be for a variety\nof reasons, ranging from lack of funds to simply forgetting to pay an\ninstalment. Defaulting on an EMI could be telling. Here are a few things to\nnote.<\/p>\n\n\n\n

1. CIBIL Score:<\/h3>\n\n\n\n
\"Cibil<\/figure>\n\n\n\n

CIBIL\nscore is one of the most significant determinants of personal loan eligibility<\/a>. A score of above 750 is\nconsidered ideal for demonstrating a good credit history. Even a single\ninstance of defaulting on EMI payments can drag your CIBIL score down by about\n50 to 70 points. <\/p>\n\n\n\n

Additional Read:<\/strong> Tips to Improve Personal\nLoan Credit Score<\/a><\/p>\n\n\n\n

2. Creditworthiness:<\/h3>\n\n\n\n

Any\ninstance of missing out on personal loan EMI payments lends a bad\nimpression on your repayment history. Despite having a CIBIL score of above\n750, lending institutions reject loan applications based on such negative\ninstances on a credit report. Lenders label such individuals as ‘risky’\nborrowers. <\/p>\n\n\n\n

3. Penalties:<\/h3>\n\n\n\n

Lending\ninstitutions often charge a late fee or a penalty from those who miss EMIs.\nGenerally, this varies between 1-2% of the due amount. <\/p>\n\n\n\n

4. Recovery Agents:<\/h3>\n\n\n\n

Sometimes,\nlending institutions deploy recovery agents once the period of default has\nextended beyond three months. In such situations, lenders typically issue a\nnotice of sixty days to the borrower before labeling the loan as NPA.<\/p>\n\n\n\n

Additional Read:<\/strong> 5 Ways to Manage your\nPersonal Loan EMI Payments<\/a><\/p>\n\n\n\n

Conclusion<\/h2>\n\n\n\n

It\nis recommended that you plan your finances efficiently to avoid any chances of\ndefaulting. If you anticipate the possibility of missing an EMI, you must\napproach your lender and discuss your financial circumstances to find the most\nviable solution. Your lender might agree to reduce the EMI by either extending\nthe loan tenure or converting the unsecured loan to a secured one.<\/p>\n\n\n\n

Make Tata Capital your finance coach so that you never have to worry about missing an EMI again!<\/p>\n\n\n\n

Apply Now<\/a><\/div>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

A personal loan is an ideal choice of funding for borrowers who don’t want to pledge any asset as collateral with the lender. <\/p>\n

Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":10989,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[24],"tags":[],"class_list":["post-10988","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-personal-use-loan"],"yoast_head":"\nWhat Happens if you miss your Personal Loan EMI? - Tata Capital Blog<\/title>\n<meta name=\"description\" content=\"Know what happens when you fail to repay your Personal Loan EMI. Know everything about the consequences of missing an EMI payment and the steps you need to take further. 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