A debt spiral can affect everyone. It is enough to make one irresponsible decision or a random situation, so that there is a threat in repayment of current debts. How can we then go straight? Here are 5 helpful tips.
The spiral of debt comes when we take out new loans to repay loans and loans . Contrary to appearances, this situation may appear imperceptibly – it is enough that we will run out of money, and another loan will be possible to take.
Now, when you borrow loans online, it’s really a very big temptation. There may then be a situation where our current income is not enough to cover these liabilities, so there is an idea to apply for another loan, usually in another loan company. As a consequence, debts are growing at a rapid pace. Calls from debt collectors can be called up, cases can also start to go to court, and from there to the bailiff. Is there a way out of this situation?
1. Do not borrow more money
The main rule when leaving the debt spiral is to stop applying for more loans. We must realize that this is not the solution to the current situation. Taking another loan will not solve the problem, and may even lead to even greater problems.
2. Develop a repayment plan
If you get lost in your loans, sit down with all the documents and analyze them thoroughly. Write down your obligations along with the repayment date and the risk of debt collection and bailiff. In this way, you can determine the order of repayment – from those debts that cost you the most, to those that are not yet very expensive.
3. Contact loan companies
Hiding the head in the sand will not do anything, and maybe even worsen the situation. Therefore, if there is a prospect of a problem in repayment of debt, contact the loan company to present its situation. Many companies then offer borrowers a change in the amount of installments so that they are easier to pay.
4. Control your money
Of course, you can not waste money on left and right then. The most important is the introduction of wise savings. You can also look for an additional source of income. To have your budget in check, think about using special applications to plan and control it.
5. Check consolidation loans
Often, we can find ads for various loans and consolidation loans, which are to tie the debt into one and reduce it. However, this offer is not always beneficial – let us remember that it is another loan , which is also interest-bearing, so it may happen that it will not be beneficial. Therefore, it is best to carefully read the offers and carry out cost simulations.
Remember also that in case of difficulties, you can apply to the foundation and other organizations involved in helping indebted people – then you can receive support from specialists in this field. Addresses of this type of organization can be found on the Internet.