Delinquent
Candlefocus EditorWhen it comes to debt and loans, delinquency can have serious consequences. Not only do delinquent borrowers typically see a lower credit score, they may also risk having a lien placed on their property or other serious financial danger. The longer a debt goes unpaid, the more difficult and costly it becomes to resolve.
In terms of financial terms, a financial professional who does not fulfill their duties and responsibilities is considered delinquent. This is especially true for individuals in fiduciary roles, such as trustees and financial advisors. Delinquencys in these cases often result in significant financial penalties and potentially jail time.
Delinquency is also a major concern for financial institutions, such as banks and credit card companies. Generally, a high delinquency rate is taken as a sign of unsound lending practices, since if too few charges are being repaid, the institutions’ profits will suffer. As such, financial institutions take steps to manage their delinquency rates and focus on debt-collection actions as necessary.
In short, delinquency occurs when debt payments are past due, and it carries serious financial and legal consequences for both individuals and institutions. Credit scores can be negatively affected, and default-related warnings may be issued if delinquency persists. With debt, time is often the most valuable commodity, and prompt repayment is the best way to prevent delinquency.