Unfortunately, many are falling into debt. This means that someone takes out a loan, that repayment has serious difficulties for him or becomes impossible. In some cases, this may be due to the borrower’s excessive greed, because he wanted to get too much or too expensive. However, there are also situations where the debtor had no other option but tried to act with care and responsibility, but his life situation or other external circumstances affecting him changed that the repayment of the loan taken was an insurmountable obstacle for him.
The latter case is practically impossible. Fortunately, not often, but anyone can lose a job for a long time, a secure income, some unfortunate event in his life that affects his financial situation, or simply increases his repayment installment so that he is unable to pay the commissioner’s income. Therefore, it is not only worth knowing what solutions exist for dealing with indebtedness, who are already directly affected by it, but for everyone who has taken out a loan or is just now applying for a loan.
Just because the biggest fear of every debtor is what will happen if he can’t repay.
What is too much loan?
How much of a loan is too much, it is difficult, or even impossible, to quantify. There are those who are in a financial situation where tens of millions of loans can be repaid by many and easy agents, while other households have a problem with repaying a few hundred thousand forints loan.
That is why it is worthwhile starting from the size of the installment and the ratio of the income to income in order to determine the “too much”. Thus, we can say that there are too many loans if the repayment of the loan (s) is such that it is difficult for the household or impossible. That is, they are unable to pay the installment and they are late, or they can repay, but there is not enough money left for other expenses (utility bills, food, etc.), which can cause another debt.
What is not a good solution for indebtedness?
Many of those who are unable to repay their loans choose from two very bad solutions: in one case they do not want to be aware of the problem, and in the other case they try to fire with new loans. Both behaviors are merely a procrastination, and in the end it can only lead to a worse situation for the debtor.
Some people think that if they do not deal with the established situation or even ignore the letters of call, they can keep the problem away. Although this is not the case, they are being deprived of the opportunity to settle their situation and navigate themselves in a situation of forced debt, while their debt just grows due to non-payment, even a legal process, enforcement can start against them.
And those who are hoping for redemption from new loans and taking personal loans to repay their previous loans will face the fact that their debt will grow as long as they will eventually be unable to cope with the huge debt.
What can be done to settle the debt?
The contractual repayment of the loan is in the common interest of the debtor and the bank (or the lender of the loan). It is in the interest of the borrower to get his money back as easily as possible, not at the expense of complicated legal procedures, so he will definitely be a partner in finding an acceptable solution to the debt with the debtor. But this can only happen if the debtor visits his problem in time rather than pulling the debtor.
It can often be a good solution to repay a loan in one amount, as this will definitely solve the problem. Unfortunately, this is not easy, only if the debtor gets the money he can make for the repayment. For example, if it is a problem to borrow a loan for your apartment, it may be a solution if you sell it and buy a smaller, cheaper property, and you can repay it (in part or in full). Of course, if it is not possible to put money into assets, there is still a possibility.
2. Renegulated Terms
If you are unable to pay your installment, you should renegotiate your loan terms with your bank. In many cases, there is a way to reduce the repayment installment by extending the term of the loan. In this case, you have to pay the loan for a longer period of time, and you will have to pay more to the debtor on the whole, but your monthly installment will be lower, so you will be able to pay and not get in big trouble.
3. Debt Settlement Loan
Debt arranging loans have been specifically designed for those who have more loans to replace their debts and only have to repay a loan to a bank on more favorable terms – at least with a lower repayment component. In general, such loans are also based on the fact that a longer maturity will result in a lower monthly installment, making it easier for the debtor to repay. This solution should not be confused with a personal loan for repayment, which results in more debt. The debt settlement loan “replaces” all existing loans rather than increasing the number of loans.