If you have several debts at the same time and you are thinking of requesting another loan, you may end up exceeding your ability to pay. Do you want to know if you are borrowing more than you owe? These are some signs.
You know that you have debts, but you do not keep track of how much you pay, what the interest is on each loan you have and what are the most expensive loans for you.
You also do not know how much of your budget is going to be paid each month and what other expenses you have, you only distribute the money as the time comes.
The worst thing is that you can’t make future plans either, because you just don’t see when to finish paying for everything .
Basically you live from day to day, as the fortnight comes, so it goes. Everything is divided between the expenses of the house and all the debts.
Ideally, you should allocate only 30% of your income to paying debts, this amount can go up to 40% if you are paying a mortgage, but it should leave you enough free money so you do not feel like you are hanged.
If all your money goes to pay debts, it is almost impossible that you can save something every month and of course you do not have an emergency fund either.
This could become a problem, because if an unforeseen event occurs, the only way you have to solve it is to borrow more.
In the end, there are so many debts that paying them every month becomes impossible. You start to be late with some payments or you have already decided to stop paying.
If you are late, the interest will increase the debt exponentially, until it becomes unpayable.
This will end up affecting your credit history, if in the future you want to request a new loan, there will be few financial institutions that will risk lending you.
Before this happens, try to negotiate with financial institutions so that the debt does not continue to grow.
Having so many commitments that you have to face will start to affect your daily life, especially if you are a responsible person.
That amount of stress can lead to insomnia problems, distraction at work, or make you more irritable and cause conflicts with your family or friends.
Before reaching the point of no return, there are several alternatives you can follow, especially if you are just detecting that it has become a problem:
Avoid requesting several credits at the same time, wait until you have paid one to request a new one.
Consider alternatives such as a loan to pay off all the debts you have at once, or look for other forms of financing.
If you are having difficulty covering all your debts, approach financial institutions and try to negotiate, some have options such as debt consolidation or refinancing, but they only offer them to those who are not late in payments.
Are you having trouble covering all your debts? Our advisors are here to help you, come to us to review the options you have regarding loans via payroll, at a fixed rate and without reviewing the Credit Bureau.