Debt Service Uk

Posts Tagged ‘Banks’

When approaching your lender to make an offer of reduced debt repayments, it’s best to be completely honest and offer them as much as you can realistically afford to pay month by month.

Whatever happens, don’t try to call their bluff.
You might think that the best thing to do is to become ballsy about your situation. After all, you know that they dont want to take legal action (because they stand to recover less of their money), and they know that you know this.

So you brazenly call your lenders bluff. You ask for interest to be suspended and then offer them a ridiculously low monthly repayment, backed up by the threat if you want any more then Ill file for my own bankruptcy and youll get nothing.

Great idea? Not quite!

Most lenders will have heard this type of threat every day of their working lives. Its just defensive bravado that will make your position worse.

Do you know how most lenders will respond to this type of macho posturing? Well first theyll stop being so understanding and then theyll reply go ahead and do it!

Now bear in mind that most lenders (e.g. banks, building societies, insurance companies etc) are massive organisations, with vast amounts of money at their disposal. So as much as you might like to think that your business is vital to their continued survival, it isnt! Even if they received nothing from your bankruptcy, it would make less of an impact on their balance sheet than a fly hitting an express train head on.

So they double bluff you.

And then what do you do? Do you back down and look weak (in which case further negotiation will be.difficult, to say the least), or do you follow through with your threat and do something (i.e. file for your own bankruptcy) that you dont really want to?

Nasty!

You should avoid this at all costs. Dont even put yourself in that position!

As I said earlier, they dont want to start legal action, but they will if they have to! So dont even test them with this little bluff.

Debt help is easy to get. Even if one doesn’t have a good credit standing, it’s possible to get debt help. Debt help is available in the form of secured and unsecured personal loans and loans for the businesses. There are loans, which are also available against your paycheck, and these are called payday loans. However payday loans can carry an interest charge, which is as high as 25%. On a compounding basis it’s essential that they be repaid back in time. Otherwise you may have to back more than the loan amount.

There are many non - profit organizations that provide loans for those in need at lower interest rates. You can structure a loan repayment structure whereby the debt can be easily paid of. Therefore they will find out how much debt you have at the moment. What are your streams of revenues and the monthly living expenses that you may have. After this they will structure a plan where you can pay the monthly interest payments easily. Thus it makes sense to make use of these non-profit organizations in times of need.

These organizations are present in all counties. One can easily approach them through the Internet, phones and fax. You can also get information about them at your local city or county council. In many cases banks themselves will tell you to approach them, when they think that they can’t help you to get out of debt. It’s important that you check out the credentials of the company before you approach them for debt help. In fact there are companies, which may steal your identity (this is called identity theft) and can land you in further debt trap. So steer clear of these fly by night companies.

Hence ask around for references and only after you have made a thorough check, approach them for debt help.