An arrear refers to an unpaid debt or obligation that is overdue, often involving a delay in payment or fulfillment. It represents a situation where something, typically money owed, is behind schedule or not met on time. This can apply to various financial commitments, such as rent, taxes, loan installments, or salaries. The presence of arrears usually implies a degree of financial difficulty or a failure to adhere to agreed-upon payment terms. It can have legal and financial repercussions, including penalties, interest charges, or even legal action. The term underscores a state of being in debt and behind on a schedule.
Arrear meaning with examples
- Despite several reminders, the homeowner remained in significant arrears on their mortgage payments, putting them at risk of foreclosure. The bank sent multiple notices, but due to unforeseen circumstances, the payments were not made on time. Their repeated arrear had resulted in hefty late fees compounding the problem and making it challenging to catch up. They sought financial counselling to try and resolve the issue and avoid losing their home.
- The company faced significant arrears in paying its suppliers due to a cash flow problem caused by delayed customer payments. This created strain on the supply chain and hurt relationships with vendors. The situation led to increased costs due to late payment penalties and difficulty securing future credit. The CEO had to consider a restructuring of the business to tackle the ongoing arrear and avoid shutting down the business.
- After the job loss, the tenant found themselves in rent arrears, struggling to afford their monthly housing costs. They attempted to negotiate a payment plan with the landlord and look into options like financial aid to avoid eviction. Finding a new job had become a priority and the rent arrear created a significant amount of stress and worry during the already challenging time. They were worried about the consequences of their missed payments.
- The government announced measures to assist citizens who were in tax arrears, offering payment plans to alleviate the financial burden. Many people had faced unprecedented challenges and the economic shock. The scheme aimed to provide relief and support to those struggling to meet their tax obligations. Many people had delayed filing their tax return leading to late fees and penalties and the need for assistance.