However, if a loan is overdue, it is recommended to pay it back as soon as possible. If your payment is overdue for more than three months or the bank has made more than two reminders, the bank will freeze your card and list you as a prohibited customer (blacklist). At the same time, you will be sued for credit card fraud and malicious overdraft, which will be enforced by the court. If a person refuses to repay after being sued and the amount owed exceeds 1,000, the court will punish him for the crime of credit card fraud in accordance with Article 1,96 of the Criminal Law.
1. The impact of overdue loans:
First, late payments will affect personal credit. If a borrower borrows money from a bank and fails to repay it overdue, a bad credit record will be left on his or her personal credit report. It will be difficult to apply for credit cards and loans in the future, and most of them will be rejected, causing a lot of trouble to personal production and life.
Second, the most direct consequence of not repaying the credit loan is high penalty interest, and you may have to pay a certain amount of liquidated damages. Even the principal and interest add up to a large expense. Failure to repay on time will increase my financial pressure.
Third, if the loan is overdue, the lender will face various collections. Banks or financial institutions have their own collection systems. When the loan is overdue, the first-level collection agency will send you text messages and call you to collect payment. If the debt is not repaid for a long time and the degree is serious, debt collectors may even collect the debt in person. The overdue person should be mentally prepared and strive to pay off the money as soon as possible before settling the matter.
Fourth, if the loan is overdue for a long time and the amount is large, the lender may be sued by the financial institution. After the lawsuit is accepted, the court can seize the lender's assets after pronouncing a verdict. This is a "repayment incentive" that the lender must implement, otherwise the court will seize the property and other assets in your name according to law and use the proceeds from the auction to repay the debt.
Fifth, if the circumstances are serious, you may be imprisoned. Under normal circumstances, incidents such as borrowing money and not repaying it are civil disputes and will not rise to the criminal level. However, if some lenders refuse to comply and insist on not repaying, and the circumstances are serious and egregious, the court will also investigate the borrower's criminal liability depending on the circumstances, and in serious cases, the borrower may be imprisoned.
2. Precautions for using credit cards
1. Repay on time:
After using up your credit card, be sure to remember to repay on time. Once it is overdue, not only will a bad credit record be generated, but overdue penalty interest will also be charged.
2. Don’t swipe your credit card too frequently:
Some people use credit cards frequently and have short intervals between card swipes, which can easily be controlled by the bank.
3. Diversified consumption:
When cardholders use credit cards to consume, they must be diversified and not limited to one place. They can swipe their cards at hotels, restaurants, shopping malls and other places. If you keep spending in one place, the bank will think that the cardholder has no spending power and reduce the number of credit cards.