Outlook Money
A job loss, business setback, medical emergency, or any sudden large expense can quickly trigger missed payments.
What should you do if you’ve already defaulted or missed 2-3 EMIs? Here are the key options available to borrowers when they find themselves on the brink of a home-loan default.
Job-loss insurance covers a borrower’s EMIs if they lose their job involuntarily. Most policies pay up to three home-loan EMIs, offering short-term protection and reducing the risk of default.
The first step is to negotiate with your lender and request a grace period. In many cases, banks are willing to grant additional time for repayment if they believe it will help the borrower get back on track.
By transferring your home loan to another financial institution offering lower rates and longer repayment tenures.
Defaults can trigger two serious consequences: the risk of losing your house and long-lasting damage to your credit score. So, avoid skipping EMIs unless there is absolutely no alternative.
If you have lost your job, taking a personal loan - often at high interest rates - is likely to worsen your financial stress and push you closer to a debt trap.
When income stops, aggressive cost-cutting becomes essential. Pause all non-essential spending to finance important things better.
Avoid overloading yourself with multiple loans and maintain a strong emergency fund.