Back to school means expenses. The use of credit is usual. Here are some tips for avoiding over-indebtedness and corporate collection pressures.
Back to school is here. Expenses are also there. The use of consumer credit is a common practice. Beware of over-indebtedness and, by extension, possible pressures if your creditor resorts to the professionalism of a collection company.
In France, over-indebtedness currently affects one million people. In Belgium, 370,701 households were victims in 2016. However, here are some useful recommendations to avoid falling into over-indebtedness.
Take out good loans
First, you only need to take out good, cheap credits. The repayment terms are excellent. The interest rate is low. The monthly payments are as suitable as the duration. The credit includes borrower insurance that covers job loss, accidents, illness.
Spend for the necessities
You are over-indebted or threatened with over-indebtedness. Why? You have less and less the financial capacity to repay your debts.
What to do? In priority, you must really know the state of your finances. You then reduce your expenses to the strict minimum according to this by taking item by item: food, clothing, fuels and travel, leisure and outings, energy.
Avoid the debt spiral
You should avoid taking out new debt, especially revolving credit. The bad reflex of the consumer is to want to honor debts by contracting a new debt very expensive. Of course, you can ask for urgent financial help from a friend or loved one. Take care to explain your situation well. If not, find other sources of income.
Negotiate in advance with your creditors
You feel the threat of over-indebtedness. Do not hesitate to approach your creditor or creditors. Present your financial situation. Negotiate a rescheduling of monthly payment.
If the economic situation is suitable, do not hesitate to have your debts repaid by a bank. You will combine them into one new loan. The rate applied must be attractive.
Your lender is however free to contact a specialized organization to be able to recover his money. The best known is the ushers’ cabinet.
To avoid over-indebtedness and to be confronted with the know-how of a collection company: take out good loans, reduce your expenses, negotiate quickly with your creditors.