For this reason, it is always helpful to be informed of the consequences of non-payment and alternative ways to reverse this situation.
Here are some of the examples that can happen if you find yourself in a situation of non-compliance:
- Be aware that if you do not comply with a single monthly installment - even if it is the first time - you run the risk of having this non-compliance registered with the Banco de Portugal (BP).
- This information will be in the Credit Responsibilities Map, which can be consulted at https://www.bportugal.pt/area-cidadao/formulario/227
- Additionally, be aware that as long as you have been reported to BP, it will be difficult to have access to new bank credit. In other words, if you want to take out a new type of credit it may be denied based on the negative information you have in the BP’s database.
- Possible collection calls by banks chasing you for money are an increasingly present reality. When you miss a deadline on the payment of credits, the collections department is normally called, which will be very insistent in the calls as well as in an attempt to recover the amount in debt. So, be aware that if you are in non-payment, you can be plagued by calls by your bank to try to recover the amount that is missing, in a very persistent way.
Two solutions to deal with non-compliance problems
Do you know what PARI or PERSI is? If you haven’t already heard about it, pay attention to these two great resources when renegotiating a loan, or even trying to reach an agreement with the bank to resolve a non-compliance situation.
These are just a few examples that are going to help you get out of a difficult situation and take control of your financial life.
PARI is the Action Plan for the Risk of Non-Compliance, that is, to try to prevent a non-complying situation with the payment of their monthly installments, and to avoid all the inconveniences inherent to this. In this plan, you will have options to pay your monthly installment, or even restructure your credit agreement, extending the final payment term, and reducing your monthly installments. There is also the possibility of a reduction in the interest rate associated with the credit agreement, which will lead to a greater reduction in the monthly installments.
On the other hand, PERSI, Extrajudicial Plan for Regularisation of Non-Compliance Situations, is a plan for cases in which consumers are already in non-compliance, but still not in court. Thus, despite the fact that there is already a failure in the regular payment of the installments, the bank tries to reach an agreement with the debtor-client, in order to avoid resorting to a bank levy, with a view to recovering the amount owed.
The method of operation is similar to PARI, with the financial institution presenting you proposals to resume the monthly payment, but with a difference: you may have to pay an ‘initial down payment’, that is, as there if your name was already reported, to resume the payment of the credit, the bank may demand slightly higher initial payment amounts, which include stamp duty, bank fees, penalties for non-compliance, among others.
Losses of assets and income
The loss of assets and income can occur when there is a situation where the payment of credits cannot be met.
As we have been mentioning above, there are some types of support for those who are unable to meet their monthly commitments, but there are also penalties and charges, which should be analysed and clarified before.
First of all, if you are faced with a bank lien or levy, you do not lose the entire amount, you must always be left with the amount corresponding to the national minimum wage (€ 665).
Be aware that a lien or levy may be filed in Court, by the creditor entity, aiming to recover the amounts owed.
In this sense, if you are informed of the existence of a lien or levy in progress against you, Deco Algarve advises you to find a lawyer in order to prevent them from appropriating your assets, property and income.
If you are unable to pay a private lawyer, you can always ask for legal aid from Social Security. Please also be aware that you can ask for a reduction of the levy from 1/3 to 1/6, if you are passing through a situation of economic need. That’s why it is important to have a lawyer to follow the process.
With this information DECO Algarve aims to avoid the loss of assets/ income as a result of non-payment of your credits.
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