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When consumers run into financial problems, they are often at risk of losing assets and their good name. Below we will list some of the most important things that are at risk during times of financial distress:
- Firstly consumers are always at risk of losing their assets when financial problems arise. This is because assets such as houses or vehicles that have been purchased on credit are liable to be seized when payment on the accounts lapse.
- Secondly a consumer also runs the risk of sullying their good name as a debtor by having poor payment, late payment, or lapsed payment reflected on their credit score. This of course means that should a consumer be free of financial problems, and seek out new lines of credit, their credit score could prevent them from qualifying. It is therefore pertinent that consumers keep an eye on their credit scores when they have financial problems in order to assess how it may affect them in the future.
- Consumers who are in financial trouble also face further financial losses as creditors can take legal action against them to recover outstanding funds. These actions can result in lengthy and costly legal battles.
- Financial problems can also result in family discord as financial worries can put a strain on relationships, and cause short fuses to burn up quickly.
Your peace of mind is also at risk when it comes to financial problems. Consumers who see financial problems looming, or who are already experiencing should ask for help immediately. One of the best forms of help for financial problems is debt counselling – as it can prevent asset loss, legal battles and help consumers restructure their finances.
Article written by: Andrea van Tonder 07-2013