{"id":11902,"date":"2023-03-10T17:30:00","date_gmt":"2023-03-10T17:30:00","guid":{"rendered":"https:\/\/businessyield.com\/?p=11902"},"modified":"2023-05-05T15:50:27","modified_gmt":"2023-05-05T15:50:27","slug":"non-performing-loans","status":"publish","type":"post","link":"https:\/\/businessyield.com\/finance-accounting\/non-performing-loans\/","title":{"rendered":"Non-Performing Loans: How to fix and avoid them (+ Detailed Guide)","gt_translate_keys":[{"key":"rendered","format":"text"}]},"content":{"rendered":"\n
So many people require loans for countless reasons, but the truth remains that some borrowers find it difficult to pay back. Here we will see what it means for a loan to be non-performing, the steps you take to avoid them, and fix it simultaneously.<\/p>\n\n\n\n
A Non-Performing Loan<\/a> is a loan that the borrower has not paid its interest for a particular period of time. It mostly occurs when the borrower runs out of cash, as well as when the debtor encounters a situation, hence unable to pay back the principal. Non-Performing Loans are called NPLs for short and can also be identified as Non-Performing Assets.<\/p>\n\n\n\n Normally, financial institutions refer to a loan as Non-Performing if the interest is due for more than 3 months or pertaining to the specified period. Nevertheless, if the borrower makes the payment of a loan that is Non-Performing, that loan is called a re-performing loan.<\/p>\n\n\n\n Since a Non-Performing Loan is a loan in which the borrower is in default, there are types of non-performing loans or categories to which it can be classified and the includes:<\/p>\n\n\n\n#2. Types of Non-Performing Loans.<\/span><\/h2>\n\n\n\n
1) Bad Debt: <\/span><\/h3>\n\n\n\n