When will the first loan repayment be due?
This differs from lender to lender but the first payment is usually taken on your preferred date of the following month. This repayment will be taken at the same time every month for the length of the term. Make sure that you check your agreement carefully for your first repayment date, if this is not something you had specified at the point of sale.
It is wise where possible to set up a direct debit to ensure that the money leaves your account on time every month. This can be done by contacting your bank and arranging for the direct debit to be set up. Don’t forget that if the funds are not available at the time the direct debit is applied for, you can be charged by the bank for a return of funds, or for an unarranged overdraft fee. Furthermore the lender may also charge you for making late or defaulted payments. Therefore it is important to keep up to date with all your loan repayments.
If you feel that you are struggling to make the payment, don’t ignore the problem. Contact your lender straight away to discuss arranging a payment plan to help you to better manage the debt. If the difficulty in making the payments is as a result of sickness or unemployment, and you have a Payment Protection Insurance, this could cover the payments for you during this time. Failure to repay an unsecured loan could badly damage your credit rating, and failure to repay a secured loan will put your property at risk. Be aware of the loan agreement terms, and remember only to borrow what you can afford to repay.