What has been happening at federal level for a long time and somehow works, looks no different for individual private individuals. Again, there are many debtors who have accumulated a large or less large mountain of debt. But unlike the state, as a private individual you have to pay your debts so as not to slip into bankruptcy and thus lose everything. Those who can therefore take out a loan for debt in order to avoid over-indebtedness and the associated consequences.
When do you start talking about debt?
In principle, any unpaid invoice, even if it is not yet due, is a debt to another person or company. Because everything that you as a consumer do not pay in cash and therefore buy on “pump”, you finance and bring yourself in financial default. In the case of purchase on account, this liability is approved by the creditor by the specified payment date. If you overstep this date, the debt becomes debt, which can quickly become a major problem.
Because a few unpaid bills and an overdrawn account are enough to count as over-indebted and no longer solvent. A situation in which millions of people are in Germany and which is neither good nor desirable. Because if you have debts, you can no longer participate in normal life and often do not have the opportunity to spontaneously make important financial decisions.
Therefore, you should always act immediately if you can see that your own liquidity can be at risk from debt. At best, with the help of a loan to settle the debt.
When is a loan worth debt?
You should only take out a loan for debt if you can afford it and if it can really be used to summarize all debts. In the end, there can theoretically only be one creditor who has to be served. Namely the bank that provided the loan. Only if this succeeds can the debt be successfully paid off and banished from life.
Furthermore, a loan for debt is only worthwhile if it is accompanied by a low effective interest rate. If an expensive personal loan has to be taken out, one can perhaps reduce the number of creditors. But if the interest rate and the monthly installments remain the same, no financial relief has been achieved and borrowing is only worth it to a limited extent.
What needs to be considered when recording it?
The goal should always be to summarize all debts, no matter how they appear, in a loan amount. Since this can result in a quite individual loan amount, the installment loan is most suitable as a loan for the debt. It can be best adapted to the borrower in terms of loan amount and repayment and is therefore the easiest to fit into their financial processes.
Since the lowest possible interest rate should be aimed for, it is important that different offers are compared with each other before borrowing. Care should also be taken to ensure that the loan is not applied for too late to repay the debt. If the debt has already manifested itself in the private credit checker and if it is deposited there as a negative entry, it will be very difficult to find a good loan offer. Because the banks and savings banks in Germany involve private credit checker in their decision regarding lending. And only if this is of a positive nature will there be a good loan offer.