Nowadays, credit commitments are not uncommon, and if you have to say frankly, it seems that only a few do not have such or other credit obligations. Many people choose to borrow money from their relatives or friends because such debts are, first of all, cheaper because they do not have to pay interest on interest on late payments and secondly, without a strict deadline. For ethical reasons and for fear of damaging relationships with relatives or friends, however, many people choose to set up credit commitments with a bank or non-bank lenders, paying more, but leaving no message unrelated to their peers.
Credit commitments create more or less stress, but the fact that debt is not pleasant – not saying “debt is not a brother” because credit is not something that a person would like to live with, even more in the long run. Stress arises because a person does not already have the money, but he is forced to take a loan and, in addition, pay a percentage of those services, which always make credit liabilities more or less expensive.
In simple words, taking credit means living across your means
Such a living can lead to an endless debt burden if the last personal funds are regularly used to repay the loan. To avoid losing your debt in a vicious circle, short-term credit should only be taken if your personal funds are exhausted only for a short period and, as happens in life, in an unsuitable moment, such as shortly before the payday or some other income day. It is preferable to take long-term credit only if you feel your financial stability and you can foresee it in the long run as well as feel responsible and committed to making long-term commitments, especially credit commitments.
Credit risk and your ability
Once you are aware of the credit risk and your ability and ability to take on credit, carefully and prudently choose the most appropriate lenders and types of credit for your situation – whether it is a bank or a non-bank lender, whether it is a long-term or short-term loan, and so on.
Credit obligations, as already mentioned, are stressful, but never give up on panic and settle your credit obligations in full – in the case of late payment of the loan, and do so in full to avoid damaging your credit history. Damaged credit history can prevent or severely hinder your future loan.
Settle your credit commitments
If you suddenly feel that you will not be able to settle your credit commitments in a fair and successful manner, because the funds have suddenly shrunk (for example, you have lost your job, have reduced wages, you need to buy a new home, have a family growth, etc.), don’t leave the whole halfway don’t look away.
Look for funding alternatives, such as borrowing money from friends or relatives, looking for additional work, selling some movable or immovable property, etc. If you are unable to reach your solution on your own, go to your creditor for a consensus and tell your situation openly – the lender can give you a credit vacation or change your credit repayment schedule and conditions that are more appropriate to your current situation.