1. What does it mean when a credit card charges liquidated damages?
It means that overdue behavior has occurred. Overdue repayment will result in credit card penalty interest, which is charged at a daily interest rate of 5/10,000, which is very costly. In addition, late payment fees will also be incurred, and the late payment fees are usually 5% of the overdue amount. Not only that, the most troublesome thing is the bad personal credit record caused by overdue credit. Once a personal bad credit record occurs, the first thing that will be affected is the application for other loans.
2. What are the consequences of overdue credit cards?
1. Penalty interest will be charged for overdue payments
No matter what kind of online loan you apply for, once the repayment occurs If the loan is overdue, the lending institution will not only notify the borrower of timely repayment as soon as possible, but also charge penalty interest according to corresponding standards (some products also have liquidated damages).
Taking JD.com Baitiao as an example, if it is not installmentd, you can enjoy a 30-day interest-free period and no fees will be incurred for normal repayment. If you apply for installment, in addition to the installment handling fee at a monthly rate of 0.5/month, if you still fail to repay after multiple reminders, a liquidated penalty will be charged at a daily interest rate of 0.03 (that is, three ten thousandths).
Like Huabei, once the repayment is overdue, a penalty interest will be charged at a daily interest rate of 0.05 or an increase of 50% of the loan interest rate. The longer the time, the greater the penalty. The interest and penalties are rolling up, which is scary.
2. Overdue records will be recorded in the credit report
Although applications for Huabei, Jiebei, and Baitiao mainly refer to the Zhima credit score and third-party credit score of the party concerned. Only if your credit score meets the standard are you eligible to apply. However, once it is overdue, it may be reported to the central bank's credit reporting system, such as Alipay. Although many online loans have not yet been connected to the credit reporting system, they may be connected to the credit reporting system soon.
3. Will be subject to various collections
If the borrower fails to repay the loan, the lending institution will go through collection procedures in order to recover the arrears. Common ones include text message collection, phone collection, Door-to-door collection. Not only will your own life be affected by that time, but if you leave an emergency contact or your address book is read, your relatives and friends will also be harassed by various collection calls.
4. Will be blacklisted by the bank
People who have been blacklisted by the bank will not be able to take flights, high-speed rail, accommodation, etc.; what is more serious is that their children will not be able to attend key schools. School; there will be more punishments in the future, and it can be said that life will be difficult.
5. You will be sued by the court to seize the mortgaged property
If the payment is not made for more than 3 months, it will be very serious. The lending bank will collect the due loan in accordance with the law, and will sue the court in accordance with the provisions of the loan contract and guarantee contract (mortgage or pledge contract). The court will take measures such as property preservation, including freezing all bank accounts of the lender and loan guarantor. deposits, seized properties that have been pledged, etc.
If a credit card is overdue, a certain amount of penalty interest and liquidated damages will be incurred during this period. It needs to be repaid together with the principal when repaying it. If you really do not have the ability to repay, you can contact the credit card center and apply for a reduction or exemption from this part of the penalty to reduce the pressure of repayment.