What Happens If My Private Borrower Doesn't Pay Off The Loan?

[Mindy Jensen]

I made a loan to someone last year. They have always paid on time, but asked for an extension. I extended 3 months, but am not comfortable extending further.

What are my options if they simply cannot pay the loan back when it is due? 

Interest only, 1-year term, extended 3 months.

[Jay Hinrichs]

If its local take a drive by and check on the collateral.. make sure its in good shape etc.

other than the options @Dave Van Horn  pointed out..

sometimes a partial pay down is nice to get.. improves your equity position and puts more of their money at risk.