What to Do After You've Defaulted on a Loan

If you have defaulted on a loan, don't panic — act quickly and honestly. Contact your credit provider to arrange repayment, get the outstanding balance in writing, start budgeting, check how the default is listed, and consider debt review if your situation is serious. Recovery takes time but is entirely possible.

Your action plan

1. Contact your credit provider immediately — don't ignore calls or letters. Ask about a payment arrangement or restructuring your loan.
2. Get a full understanding of the outstanding balance, interest and fees. Request it in writing.
3. Start budgeting. Cut unnecessary expenses and commit to regular payments — even small ones.
4. Check your credit report to see how the default is listed and track your improvement.
5. Consider debt review if your situation is serious. It is a legal process that can protect you from legal action and restructure your debts.

Fixing a default won't happen overnight, but with consistency you can rebuild. For next steps, read How to Rebuild Your Credit Score and Debt Counselling: Is It Right for You?