Paying EMIs on time is crucial to avoid late payment charges, penalties, and a decreased credit score. They can also cause consequences like recovery agents, which can be humiliating as well. However, sometimes unforeseen circumstances can make it challenging to meet the payment deadline, resulting in EMI payment delays. If you’ve ever missed EMI payments, you might have noticed that it can be difficult to catch up on late EMI payments. Because of this, you may end up paying extra to clear the arrears. Let’s explore the reasons why you may still be paying extra on late EMIs and what you can do to avoid these additional costs.
What is an EMI?
Equated Monthly Installment (EMI) is a fixed amount of money that you pay to the lender every month until the loan is repaid. It contains a part of the principal amount added to the interest applied. The total sum of the loan and payable interest is divided by the number of months of the tenure. After this, you get a fixed sum to repay every month as an EMI. It is an easy way for individuals to pay off a large amount of money over a period. However, failing to pay the EMI on time can result in significant consequences.
What Happens When an EMI Is Late?
- Late payment charges: When you miss an EMI payment, the lender usually charges a late payment fee. Late EMI payment fee is typically a percentage of the outstanding amount but varies depending on the lender. Late payment charges can increase the total cost of the loan and create additional financial stress for you.
- Penalties: If you continue to miss EMI payments, the lender may impose additional penalties. It’s added above the late payment fees on missed EMIs payments thus increasing the cost of the loan even more. It can also include legal action, loan cancellation, or even seizing collateral if the loan is secured. Such penalties can cause significant financial damage and stress for you as a borrower.
- Decreased credit score: Late EMI payments can negatively affect a borrower’s credit score. It can make it challenging to get approved for loans and credit cards in the future. A lower credit score may also result in higher interest rates and unfavourable loan terms. Therefore, it is crucial to make EMI payments on time to maintain a good credit score.
How FlexPay Saves You from Paying Extra on EMIs
- Interest applied on the use of money: FlexPay gives a line of credit in the form of a loan. A line of credit and credit limit are approved for your account. Out of this credit limit, you can keep spending money as you need. You are only liable to pay interest on the spent sum. This saves you from paying extra on an EMI. It also results in a variable EMI being formed every month that you can easily manage in your budget. The smaller and variable repayable amount saves you from EMI payment delays
- Flexible repayment options: No fixed EMI is mandatory for repayment here. Flexible repayment options are extended, where variable installments are accepted without any additional charges or penalties imposed. For a salaried professional, this works like a boon because it saves them from a cash crunch that can occur due to a fixed monthly income. You don’t have to keep piling for repayment or pay a fixed sum every month. You can plan your budget variably and keep repaying your loan as well.
- Flexible tenure for repayment: We offer a flexible tenure that varies between 10 to 36 months. During this term, you can repay your loan at any time. As long as you pay the minimum monthly dues, no additional costs are applied to missed EMI payments. If you choose to repay your loan in one go before the tenure ends, there are no foreclosure charges as well. Also, you don’t have to pay any fees or penalties for EMI payment delays.
FlexPay is an RBI-approved NBFC that provides a line of credit exclusively to salaried people. If your salary is Rs. 8000 or above every month, you are eligible for this loan. We are less stringent with credit checks, and approval is possible even after a soft credit check. As long as your credit history is clear and you are a potential borrower in terms of repayment, this loan is an easy deal for you. Following a simple online application process, and based on your income statement, you can access the cash in your account within 24 hours.
Relaxed eligibility, easy application, online availability, reasonable rates, and charges make this loan the right choice for you. While documentation is digital, it is minimal as well. Just with your Aadhaar card, PAN card, salary slip, bank statement, and one passport-size photograph, you can complete the procedure. Verification is 100% digital, which is completed through KYC via a video call. It is time-saving and makes the loan possible anywhere, anytime.
Along with being an easy-to-avail loan, it is equally smooth in repayment. Flexible installments are accepted along with flexible tenure provided for repayment, making it the best line of credit. As you use the money, you can keep on paying it back. If you are not in a position to pay back the full EMI every month, you don’t have to bother about charges applied on EMI payment delays. With minimum monthly repayments, you are safe from any late EMI payments. There is no chance of missed EMI payments because we accept variable installments without any added cost. For your fluctuating financial requirements, this works as continuous credit support for every salaried individual.