It may not be the easiest decision to make or something you want to do, but failing to pay off a loan or card can bring you more than a headache. It could bring great repercussions to your finances.
Undoubtedly paying debts promptly should be a priority. When you are about to use your card or buy on credit, the first thing to think about is whether you can make the payments. In case you no longer have solvency or some mishaps have arisen, stop paying can bring problems with clearing. Not to mention that his record will be stained.
What to do when I can no longer pay my debts
However, one day we are without problems spending comfortably and the next we could lose our job. For those who have gone through times when they cannot afford to pay the minimum card, we have these 4 steps to deal with their debts.
1. Act fast
Do something to try to solve it as soon as possible. There is no time to mourn or be depressed. The longer you spend and you are not paying the consequences will be much worse.
2. Be aware of the situation you are in
The main reason why you may fall into the level of over-indebtedness is that you do not know the magnitude of the problem. Whenever you commit to a loan or credit agreement you must know the terms and important information.
- – Total debt, interest, and capital.
- – Annual and total interest rates.
- – Cost of the annuity (in case you receive annuity).
- – Insurance and commission costs.
- – Payment and cut dates.
3. Know the ability to pay
To determine how much money you can contribute to the payment of your debts you must know in detail how much money you make. You should also know how much money is left in the end after paying your responsibilities and fixed payments. Once you determine where your money is and how much you have available, you will know how much you can afford.
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If you notice that there are things on the expense list that you can dispense with such as gym membership or pay TV subscription, you can get rid of these expenses. When you are going through financial problems you need to realize that you must get rid of unnecessary expenses and stop wasting on luxuries. You probably owe to lead an austere life until your life improves.
4. Discuss with the bank
Only by really knowing your situation can you go to dialogue with the financial institution with which you have a debt. Whatever good intention you have to pay your debts, the institutions will see it as something positive. It is opening the dialogue and the possibility of payment. This is much better than giving up and not paying anything.
At the end of the account, of course, the bank does not want to give your money for lost and will do anything to get the payment.