Reminder

A loan agreement defines the dates by which the borrower must pay his monthly instalments. If an instalment payment is not received by the lender on time or not in the agreed amount, the lender will usually send the borrower a reminder.

This serves as a payment notice. Initially, the reminder will assume that payment has been missed by mere oversight. Further reminders may follow to increase the pressure on the non-paying borrower.

The costs for the reminder are charged to the borrower and added to the remaining loan amount.

To avoid a reminder and the associated costs, monthly payments should always be transferred a few days before the due date. To ensure that the payment is not simply forgotten, it makes sense to set up a standing order that automatically transfers the amount each month.

Reminders are a pre-judicial debt collection measure. If reminders fail to persuade the borrower to meet his payment obligations, the case usually moves on to legal debt enforcement, which works towards debt enforcement.