Failure to pay debt or loan –due date lapses

[Starmix]

If the debt remains unpaid after the due date has lapsed, the money lender could consider the following:

• Civil action;
• Negotiation and mediation;
• Statute of limitations, and
• Evidence.

The lender can pursue a civil case against the debtor to recover the debt. This is the most common route in such situations. The lender would need to present evidence of the debt, like a loan agreement, promissory note, and others, to the court. Before or instead of pursuing legal action, the lender and the debtor could try to negotiate a payment plan or seek mediation. This might involve agreeing on a reduced amount or a schedule of payments that the debtor can manage.

There is a legal time within which a lawsuit must be filed to recover a debt. The length of this period varies depending on the jurisdiction and the type of debt. After the statute of limitations expires, the lender may lose the right to sue for the debt. If the lender suspects that the debtor obtained the loan through fraudulent means, they might consider reporting it to law enforcement. However, as mentioned before, proving fraud requires more than just non-payment.