- What if I can’t pay this month?
- What happens if my loan goes into default?
- If I miss a payment, will it reflect on my credit report?
What if I can’t pay this month?
If you’re unable to make a payment on your loan due to financial difficulties or other personal circumstances, your first step should be to contact our team at firstname.lastname@example.org.
We’ll work with you to understand if you’re eligible for a payment arrangement and determine the best option for you. Remember, it’s always in your best interest to continue paying as much as you can towards your loan. It’s always best to reach out to our team before missing a payment or paying a reduced installment- we’re here to help you find the right solution. Forbearance should only be a last resort because it could lead to a higher total cost of borrowing. You can learn more about forbearance here.
Remember that without the approval of a formal assessment, it will be considered as non-payment toward your loan and this will negatively impact the status of your loan as well as your credit reporting.
You can learn more about our credit reporting process here:
What happens if I continue to miss payments on my loan?
While it always in your best interest to meet the required payments toward your loan/s each month, should you miss a payment by the payment deadline, it will be viewed as non-payment for that month.
Once you have missed two payments the following notice will be sent to you;
The notice is a legal requirement of the UK Consumer Credit Act of 1974. According to section 86B of the act, it is our duty to issue the borrower with a notice once the arrears on the loan reach a value of two monthly installments. This notice will be sent on the month the loan has incurred these arrears.
Should you continue to miss payments - the following legal charges will be applied to your loan after the letter has been sent;
- USD 96.00
- GBP 72.00
- EUR 84.00
- You will have 35 days to get your repayments on track, or interest will start incurring on the charge.
If you’re unable to make payments or choose not to pay, your loan will first fall into arrears and then into default.
What happens if my loan goes into default?
If your loan is in default, we will terminate the agreement we have with you and begin legal proceedings to recover the outstanding balance. Our loans are enforceable in 150 countries.
Please note that the option to request a payment arrangement is no longer available once your loan has defaulted.
Legal enforcement generally begins through arbitration, except when the outstanding balance is below a certain level - in those cases proceedings will begin in court. You can read more about our arbitration process here.
Remember, our preference is always to help you through financial difficulties so be sure to contact us at email@example.com for support before you get to default.
If I miss a payment, will it reflect on my credit report?
We report payment data to Experian for US residents, and to Transunion for UK residents. By law, we’re required to report both positive and negative payment information.
If it’s the first time you’ve missed a payment, your credit score won’t necessarily reflect a change. However, if you continue to fall behind on payments, you are likely to see a negative impact on your credit score.
The credit bureaus that Prodigy Finance reports to in both the US and the UK have adjusted the process for lenders to report alternative payment arrangements during the COVID-19 period. If you were paying on or ahead of schedule but you’ve since entered a forbearance arrangement due to COVID-19, Prodigy Finance will continue to report your loan as on schedule to Experian in the US and Transunion in the UK