2 min read
Illustrative only. Assumes a fixed rate and equal monthly repayments (annuity). Your actual offer depends on Credicorp’s assessment of your company.
What arrears are
A loan falls into arrears when payments are behind schedule — one or more missed and not caught up. It is a step beyond a single missed payment, and it flags to the lender that the borrower is under strain. The sooner arrears are addressed, the more options remain.
The effect on credit and recovery
Arrears are reported to the credit reference agencies and drag the credit score while they persist. Prolonged arrears can lead to a formal default, a CCJ, and recovery action. Clearing them stops the ongoing harm.
Routes to clearing them
The usual path is to agree a plan with the lender: catch up the missed amount over a few months, or restructure the loan to a more affordable schedule. Most lenders prefer a workable arrangement to enforcement. Restructuring or refinancing to a longer term can make payments fit again.
Preventing a repeat
Once clear, rebuild headroom so the same pressure does not recur. If the loan was simply too big for the cash flow, that is the real fix. See avoiding default.
Find an affordable schedule
Use the calculator to work out a repayment your cash flow can sustain.
Credicorp lends to your company, not to you personally, and takes no personal guarantee. See indicative terms on business loans, or apply online in minutes.
Frequently asked questions
What are loan arrears?
Payments that are behind schedule — one or more missed and not caught up. It is a step beyond a single missed payment and signals financial strain, so it should be addressed as quickly as possible.
How do I clear business loan arrears?
Agree a plan with the lender to catch up the missed amount, or restructure the loan to a more affordable schedule. Most lenders prefer a workable arrangement to enforcement action.
How do arrears affect my credit?
They are reported to the credit reference agencies and drag the score while they persist. Prolonged arrears can lead to a default, a CCJ and recovery action, so clearing them promptly is important.
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