Loan penalties are enough to drive a borrower crazy. Such penalties can reach as high as 20-30% per month, and the rate can even be higher if extra fees are calculated. Every lender has different ways of issuing penalties, yet one thing is certain: you’ll have a bad time. If you want to avoid these penalties, you must plan ahead.
Check out these strategies on dealing with high loan penalties:
Obtain New Income Streams
The fastest thing that you can do now is to get a new income source. Analyze your skills and figure out if you can do some extra jobs for people. Fortunately, there are dozens of websites that you can visit if you’re looking for freelance gigs. Visit these platforms and check out the gigs being offered. If the gigs match your current skillsets, then do not hesitate to send application. Even though competition is tough, you can pull through if you’re persistent and truly capable of doing job well. With few extra gigs under your name, you can cover your loan penalties and possibly repay the loan in full.
Conduct a Fire Sale
Do you want to gain few extra bills immediately? Well, you must check every nook and cranny of your home. If you have extra stuff, you should brace yourself and prepare for a garage sale. The profits from the sale can be used to cover your loan’s penalty fees and weekly interest. You might even gain a little extra that you can tow away. Who knows? Maybe you can find a rare collectible in your basement. Fire sales are quick ways to generate easy money, but you can take up the notch by selling your items in eBay or Amazon. You can even sell items on Facebook and start your own online shop. Aside from repaying the loan, you now have a startup online business that’ll pay the bills.
Talk to Your Lender
When all strategies fail, you have to sit down with your lender and discuss settlement terms. Not all lenders are open for negotiations, especially if you’re dealing with banks and big providers. But if you’re successful, the lender may reduce your interest or cut down extra fees. Keep in mind that honest communication can definitely take you far.
Missing out your payment and getting penalized is a hard pill that you must swallow. You can’t entirely avoid this from happening. But you can learn from the event. Next time, create a detailed repayment plan so you can settle your loan without hassles.