Businesses use a lot of different strategies to deal with problem borrowers:
– Deposit. You have to put down money, you only get it back if you return it.
– Credit card on file. The company takes your credit card info and charges you for the costs of your shenanigans, plus a fee.
– Internal reputation / blacklist. The company keeps records of all its loans, if they recognize you trying to borrow again, they’ll refuse to let you.
– Industry-wide reputation / blacklist. Multiple companies or entire industries all talk to each other about bad borrowers. This is basically what a credit rating is — if you screw one company by not repaying a loan, getting additional loans later gets much harder, with higher rates and worse terms.
– Collateral. The company sets up the loan so that they can seize and sell your house, car, or other property (e.g. stocks).
– Lawsuits. The company can sue you. If you don’t show up to court, or lose the case, the company can ask the judge to order your employer to send part of your pay directly to pay off your debt, and/or order the sheriff (police) to physically take away your property to be sold to pay your debts.
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