Managing credit debt is as a hand goes into a glove. Nothing else will do when it comes to a good credit rating but to also be a good debt manager.
money in gloved hand
If you as debtor can’t manage to do this then the chances are very high that you may not have a good credit rating for too much longer.
In the recent past, credit has been too easy to access for many people who weren’t in a good financial position in the first place to be loaded up with debts that they had no way to pay off. The provision of this credit is now linked to irresponsible lending providers who had more of an eye to their bonuses than they showed towards their clients. Consequently, the global financial system came close to collapse all around the world.
Ultimately though, we are all responsible for ourselves and if we were already struggling financially, then we all should have taken the hard road and not tried to buy our way out of debt.
But then again, hindsight always knows better as to what should have been done instead of what we actually did.
Once a financial institution has extended a line of credit to you for whatever purpose; that is a debt that must be paid.
If money is short and you are having difficulty paying off a credit card debt or a store card debt, then the best idea is to make an opportunity to see a finance officer either at a bank for a lower interest rate loan or at the financial institution you owe the money to, to arrange for a repayment schedule if possible.
Not all financial institutions will agree to this so you will need to show an honest intent. Once they can see that you are really battling to pay off your loans, many of them will decide a little bit of something regularly is better than a whole lot of nothing ever.
However, if the credit has been extended to you or your business as a secured loan, it could be a quite different matter and the financial institution may decide to send you into bankruptcy so they can recover their loan faster. There are always variables and one of the unknowns to a petitioner for loan leniency is the fact that you won’t know the financial institutions own financial position.
Finances in the world today are set up like a string of dominoes. Once the first one falls over, the rest follow in turn. This is one of the biggest reasons why the world we live in today must have a more regulated world financial system.
In the meantime, as a debtor to a financial institution somewhere, your good management of your own finances will go a long way towards keeping you from becoming just another statistic.