{"id":3792,"date":"2021-09-03T01:58:12","date_gmt":"2021-09-03T01:58:12","guid":{"rendered":"https:\/\/www.ibpo.com.my\/?p=3792"},"modified":"2024-12-03T03:31:24","modified_gmt":"2024-12-03T03:31:24","slug":"what-happens-when-a-loan-defaults","status":"publish","type":"post","link":"https:\/\/www.ibpo.com.my\/bm\/what-happens-when-a-loan-defaults\/","title":{"rendered":"What Happens When a Loan Defaults?"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"3792\" class=\"elementor elementor-3792\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-0e45dbc elementor-section-full_width xts-section-stretch-content elementor-section-height-default elementor-section-height-default\" data-id=\"0e45dbc\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-33602b0\" data-id=\"33602b0\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-d996c5c elementor-widget elementor-widget-html\" data-id=\"d996c5c\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t[xts_html_block id=\"3506\"]\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-86c14ad elementor-section-full_width elementor-section-height-default elementor-section-height-default xts-section-disabled\" data-id=\"86c14ad\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-5c446df\" data-id=\"5c446df\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-a1e5a17 elementor-widget elementor-widget-shortcode\" data-id=\"a1e5a17\" data-element_type=\"widget\" data-widget_type=\"shortcode.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"elementor-shortcode\">\t<div class=\"ibpo-articles xts-single-post-header\">\r\n\t\t<div class=\"xts-post-meta\">\r\n\t\t\t\t\t\t\t\t\t\t<div class=\"xts-post-categories\">\n\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t<a  class=\"xts-post-category\" href=\"https:\/\/www.ibpo.com.my\/bm\/category\/articles\/\" rel=\"category tag\">\n\t\t\t\t\t\tArticles\t\t\t\t\t<\/a>\n\n\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t<a  class=\"xts-post-category\" href=\"https:\/\/www.ibpo.com.my\/bm\/category\/articles\/personal-finance\/\" rel=\"category tag\">\n\t\t\t\t\t\tPersonal Finance\t\t\t\t\t<\/a>\n\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t<div class=\"xts-post-date\">\n\t\t\t\t\t\t\t<time class=\"published\" datetime=\"2021-09-03T01:58:12+00:00\">\n\t\t\t\t\t3 September 2021\t\t\t\t<\/time>\n\t\t\t\t<time class=\"updated\" datetime=\"2024-12-03T03:31:24+00:00\">\n\t\t\t\t\t3 Disember 2024\t\t\t\t<\/time>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\r\n\r\n\r\n\t<\/div>\r\n\r\n\t\t\t<h1 class=\"ibpo-articles xts-post-title xts-entities-title\">\r\n\t\t\t\tWhat Happens When a Loan Defaults?\t\t\t\t<\/h1>\r\n\t\t\r\n\r\n\r\n\t\r\n<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-60bed14 xts-scheme-inherit xts-textalign-inherit elementor-widget elementor-widget-text-editor\" data-id=\"60bed14\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<style>\/*! elementor - v3.23.0 - 23-07-2024 *\/\n.elementor-widget-text-editor.elementor-drop-cap-view-stacked .elementor-drop-cap{background-color:#69727d;color:#fff}.elementor-widget-text-editor.elementor-drop-cap-view-framed .elementor-drop-cap{color:#69727d;border:3px solid;background-color:transparent}.elementor-widget-text-editor:not(.elementor-drop-cap-view-default) .elementor-drop-cap{margin-top:8px}.elementor-widget-text-editor:not(.elementor-drop-cap-view-default) .elementor-drop-cap-letter{width:1em;height:1em}.elementor-widget-text-editor .elementor-drop-cap{float:left;text-align:center;line-height:1;font-size:50px}.elementor-widget-text-editor .elementor-drop-cap-letter{display:inline-block}<\/style>\t\t\t\t<div class=\"vc_row wpb_row vc_row-fluid\"><div class=\"wpb_column vc_column_container vc_col-sm-12\"><div class=\"vc_column-inner\"><div class=\"wpb_wrapper\"><div class=\"wpb_text_column wpb_content_element \"><div class=\"wpb_wrapper\"><div class=\"vc_row wpb_row vc_row-fluid\"><div class=\"wpb_column vc_column_container vc_col-sm-12\"><div class=\"vc_column-inner\"><div class=\"wpb_wrapper\"><div class=\"wpb_text_column wpb_content_element \"><div class=\"wpb_wrapper\"><div class=\"vc_row wpb_row vc_row-fluid\"><div class=\"wpb_column vc_column_container vc_col-sm-12\"><div class=\"vc_column-inner\"><div class=\"wpb_wrapper\"><div class=\"wpb_text_column wpb_content_element \"><div class=\"wpb_wrapper\"><div class=\"vc_row wpb_row vc_row-fluid\"><div class=\"wpb_column vc_column_container vc_col-sm-12\"><div class=\"vc_column-inner\"><div class=\"wpb_wrapper\"><div class=\"wpb_text_column wpb_content_element \"><div class=\"wpb_wrapper\"><p>MCO-related financial aid has helped keep loan default fears away for now, but we must continue to<strong>\u00a0keep an eye on our debts<\/strong>\u00a0for when the pandemic (eventually) ends. We must have a plan in place to avoid falling into financial ruin when repayment begins again. The last thing you want is for\u00a0<strong>a loan to default<\/strong>.\u00a0<\/p><h2><b>What is a Default?<\/b><\/h2><p>Put simply, a loan defaults when the\u00a0<strong>borrower misses, avoids, or fails to make timely payments<\/strong>, including interest or principal. This applies to both\u00a0<em>secured<\/em>\u00a0and\u00a0<em>unsecured<\/em>\u00a0loans.\u00a0<\/p><p>Loan defaults lead to a number of severe consequences, depending on the type of loan. The most severe consequences include\u00a0<strong>lower credit scores<\/strong>,\u00a0<strong>lowered chances of obtaining future credit<\/strong>, and\u00a0<strong>raised interest rates<\/strong>\u00a0on existing and future debts.<\/p><p>Make sure you know how long your grace period is for repayment, and seek help if you feel you have trouble repaying!\u00a0<\/p><h2><b>How Defaults Can Affect You<\/b><\/h2><h3><em>Mortgage Loans<\/em><\/h3><p><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone size-medium wp-image-8415\" src=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-300x200.jpg\" sizes=\"(max-width: 300px) 100vw, 300px\" srcset=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-300x200.jpg 300w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-1024x683.jpg 1024w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-768x512.jpg 768w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-1536x1024.jpg 1536w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-2048x1365.jpg 2048w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-219x146.jpg 219w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-50x33.jpg 50w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-113x75.jpg 113w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-942x628.jpg 942w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-750x500.jpg 750w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-1140x760.jpg 1140w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/stamped-paper-form-mortgage-min-scaled.jpg 1920w\" alt=\"Mortgage Loan Defaults\" width=\"300\" height=\"200\" \/><\/p><p>The bank will send a court order to have the borrower\u2019s house auctioned. The debtor will\u00a0<strong>lose their house<\/strong>\u00a0and any equity they established. Until the home loan is paid off in full, the house belongs to the bank<\/p><h3><i>Auto Loans<\/i><\/h3><p><img decoding=\"async\" class=\"alignnone size-medium wp-image-8416\" src=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-300x200.jpg\" sizes=\"(max-width: 300px) 100vw, 300px\" srcset=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-300x200.jpg 300w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-1024x683.jpg 1024w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-768x512.jpg 768w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-1536x1024.jpg 1536w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-2048x1365.jpg 2048w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-219x146.jpg 219w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-50x33.jpg 50w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-113x75.jpg 113w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-942x628.jpg 942w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-750x500.jpg 750w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-1140x760.jpg 1140w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/car-model-calculator-coins-white-table-min-scaled.jpg 1920w\" alt=\"Auto Loans\" width=\"300\" height=\"200\" \/><\/p><p>Similar to housing loan default, the\u00a0<strong>car<\/strong>\u00a0or\u00a0<strong>vehicle<\/strong>\u00a0in question will be\u00a0<strong>repossessed<\/strong>. Debtors will have to get used to walking or e-hailing again until they can manage to repay the full loan and hope no one purchases it from the bank beforehand.\u00a0<\/p><h3><i>Credit Card\u00a0<\/i><\/h3><p><img decoding=\"async\" class=\"alignnone size-medium wp-image-8417\" src=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-300x200.jpg\" sizes=\"(max-width: 300px) 100vw, 300px\" srcset=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-300x200.jpg 300w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-1024x683.jpg 1024w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-768x512.jpg 768w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-1536x1024.jpg 1536w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-2048x1365.jpg 2048w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-219x146.jpg 219w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-50x33.jpg 50w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-112x75.jpg 112w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-942x628.jpg 942w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-750x500.jpg 750w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-1140x760.jpg 1140w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/credit-card-screen-cashless-payment-new-normal-min-scaled.jpg 1920w\" alt=\"Credit Card Loans\" width=\"300\" height=\"200\" \/><\/p><p>A credit card is actually a tool for loans, remember when you\u2019re\u00a0<strong>buying with a credit card<\/strong>, you are\u00a0<strong>borrowing from the bank<\/strong>. When debts cannot be paid, there is grounds for a lawsuit, but why on earth would they sue someone who has no money?\u00a0<\/p><p>There are other ways banks can try to get back their money. A wage garnishment may be applied. This is when the debtor\u2019s paycheck is partially withheld legally and given to the lender until the debt is repaid. Otherwise, they could freeze all the money in your bank account.\u00a0<\/p><h3><i>Secured Loans<\/i><\/h3><p>Secured loans contain an asset provided by the borrower as\u00a0<strong>collateral<\/strong>, which could be a car, house, cash, bonds etc. When the loan defaults, the lender simply\u00a0<strong>seizes the asset<\/strong>.\u00a0<\/p><h3><i>Unsecured Personal or Business Loans<\/i><\/h3><p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-8418\" src=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-300x200.jpg\" sizes=\"(max-width: 300px) 100vw, 300px\" srcset=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-300x200.jpg 300w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-1024x683.jpg 1024w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-768x512.jpg 768w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-1536x1024.jpg 1536w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-2048x1365.jpg 2048w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-219x146.jpg 219w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-50x33.jpg 50w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-113x75.jpg 113w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-942x628.jpg 942w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-750x500.jpg 750w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-1140x760.jpg 1140w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/top-view-business-office-desk-background-business-loan-appcation-form-pencil-letter-diary-tree-wooden-table-background-with-copy-space-min-scaled.jpg 1920w\" alt=\"Unsecured Loans or Business Loans Defaults\" width=\"300\" height=\"200\" \/><\/p><p>Just because there is no collateral doesn\u2019t mean the debtor is off the hook. Without a collateral, there is grounds for a\u00a0<strong>lawsuit<\/strong>, in which the worst case scenario is\u00a0<strong>wage or revenue garnishment<\/strong>. One way or another, the\u00a0<strong>bank will reclaim their money<\/strong>.\u00a0<\/p><h2><b>Other Possible Consequences<\/b><\/h2><h3><i>You\u2019ll Have to Pay a Lot More<\/i><\/h3><p>When you skip payments, you are actually also accumulating\u00a0<strong>extra charges<\/strong>, particularly from compounding interests.\u00a0<\/p><p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-8419\" src=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-300x214.jpg\" sizes=\"(max-width: 300px) 100vw, 300px\" srcset=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-300x214.jpg 300w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-1024x731.jpg 1024w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-768x549.jpg 768w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-1536x1097.jpg 1536w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-2048x1463.jpg 2048w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-204x146.jpg 204w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-50x36.jpg 50w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-105x75.jpg 105w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-879x628.jpg 879w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-750x536.jpg 750w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-1140x814.jpg 1140w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/bank-client-discussing-interest-min-scaled.jpg 1920w\" alt=\"Client Discussing Loan Interest Rates\" width=\"300\" height=\"214\" \/><\/p><p>While it seems counterproductive to pile on extra fees for someone unable to repay their debts, this is the reality of many banks. So, making repayments on time is crucial.\u00a0<\/p><h3><i>No More Financial Help<\/i><\/h3><p>When loans default, your\u00a0<strong>credit score is pretty much also ruined<\/strong>, so you\u00a0<strong>won\u2019t be able to apply for any future credit<\/strong>\u00a0or<strong>\u00a0financial help<\/strong>\u00a0from banks or licensed lenders in the future.<\/p><p>Once you get labeled a high risk borrower, it is tough to get back on track, so make sure it doesn\u2019t happen!<\/p><h3><i>Bankruptcy<\/i><\/h3><p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-8421\" src=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-300x200.jpg\" sizes=\"(max-width: 300px) 100vw, 300px\" srcset=\"https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-300x200.jpg 300w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-1024x683.jpg 1024w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-768x513.jpg 768w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-1536x1025.jpg 1536w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-2048x1367.jpg 2048w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-219x146.jpg 219w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-50x33.jpg 50w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-112x75.jpg 112w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-941x628.jpg 941w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-750x501.jpg 750w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-1140x761.jpg 1140w, https:\/\/www.ibpo.com.my\/wp-content\/uploads\/2021\/09\/petition-bankruptcy-debt-loan-overdrawn-trouble-concept-min-scaled.jpg 1920w\" alt=\"Bankruptcy happens if too much of your loan defaults\" width=\"300\" height=\"200\" \/><\/p><p>This is the absolute worst thing that can happen, but failure to repay a loan can result in\u00a0<strong>bankruptcy<\/strong>.\u00a0<\/p><p>A bankrupt person or entity will have their assets managed by a\u00a0<strong>Director General of Insolvency (DGI)<\/strong>\u00a0for repayment. He or she will also be\u00a0<strong>banned from leaving the country<\/strong>, withdrawing money or spending more than RM1,000, and they will have to sacrifice a percentage of their salaries each month.\u00a0<\/p><h2><b>Need Help Settling Unsecured Debts?\u00a0<\/b><\/h2><p>At IBPO,\u00a0<strong>we can help you<\/strong>\u00a0if you\u2019re struggling to pay off heavy unsecured debts like credit card payments.\u00a0<\/p><p>Our\u00a0i-Debt Management programme\u00a0has been known to\u00a0<strong>reduce existing loan interest rates<\/strong>\u00a0to as low as 6% p.a. and\u00a0<strong>reduce monthly commitments<\/strong>\u00a0by up to 70%.\u00a0<\/p><p>In addition, our\u00a0<strong>expert financial consultants will advise you<\/strong>\u00a0on your next move and how to manage your finances better in the future.<\/p><p>For more information, visit\u00a0<strong><a href=\"https:\/\/product.ibpo.com.my\/en\/i-debt-management\/\">i-Debt Management<\/a><\/strong>.<\/p><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>[xts_html_block id=&#8221;3506&#8243;] MCO-related financial aid has helped keep loan default fears away for now, but we must continue to\u00a0keep an eye on our debts\u00a0for when the pandemic (eventually) ends. We must have a plan in place to avoid falling into financial ruin when repayment begins again. The last thing you want is for\u00a0a loan to [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":3794,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[17,73],"tags":[89,90,33,64,91,92],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Understanding Loan Defaults: Causes, Consequences, and Solutions - IBPO Group<\/title>\n<meta name=\"description\" content=\"Explore the reasons behind loan defaults and learn about the potential consequences for borrowers. 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