Alongside the potential for early repayment, or penalties for this action, it’s important to understand what you’ll be charged if you make a late payment or miss a payment. With a debt consolidation loan, penalties across the board may be stiffer than those associated with your credit card account.
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Of course, no one wants to miss a payment or make a late payment and potentially feel an impact on their credit as a result. However, many people who rely on debt consolidation loans may already be overwhelmed with their required contributions, or they may be nearing this stage. This circumstance can make for a monthly calculation of what can be afforded on a revolving basis. There may come a time when a borrower has to make a tough decision between paying their credit card bill on time or purchasing groceries to put food on the table for the next week. Evaluating the penalties for late or missed payments will help you place this new debt obligation in a pecking order alongside other bills, credit card obligations that you aren’t paying off with the debt consolidation loan, and any other expenditures that factor into your fiscal life.
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Fortunately, while a credit card account may be subject to penalty APR adjustments that make the repayment even more difficult after you’ve missed payment or contributed late, personal loans typically don’t incorporate this type of repercussion — but will certainly charge late fees.