A lot of face debt crisis every now and then either due to our own recklessness or due to bad decision making. Debt crisis is a near unavoidable occurrence and as such no one should feel stigmatised about it. However, the way we all get out of debt crisis can determine how we avoid a repeat and more importantly if we come out of it with our health in tact. I have faced debt crisis myself and have sometimes due to luck or financial ingenuity come out of it better. I also figured the most limiting factor with debt crisis is not your inability to pay but your inability to pay when the debt is due, meaning if people are given more time they can actually pay. Here are some ways one can get out of a debt crisis;
- Confide in Family – A lot of people, particularly guys believe it is unfair to share the pressures of debt with their family. It is even shocking that they do not even tell their wife let alone siblings or parents. Some years back when I faced a debt crisis situation I was able to resolve it because I told my wife. Unbeknownst to me, she had some savings which she stashed away for days like this. That helped pull me through following which I refunded her in a comfortable time period.
Talk to Friends – 2pac once said, keep your enemies close and watch you friend which is true. However, we still have some friends who are always there in times of need. A lot however, depends on how you are perceived and what you do to help others. There is always a magnanimous friend out there and by the way they need not be your close friend. The most unlikely people are those who actually even given. The risk however is that your problems are out in the know. However, if this is the only option you have then better explore it.
Talk to close Community – A lot of us belong to a church, mosque, committee of friends who are always there in times of need. Provided you haven’t abused this option in the past, it is always a logical way of getting out of debt. They can give you soft loans at a considerably longer tenor provided you show that you have a source of paying back.
Reappraise your Net-Worth -Sometimes we do not know how rich we are till we are really broke. The point is whilst being broke is a liquidity issue, some of us have assets that we can actually monetize quickly but yet fail to take notice due to the panic that accompanies the situation. Assets like Jewellery, cars, shares are very common ways of monetizing assets. The key here is not to appear to be under pressure as that may negatively affect the value that you get.
Talk to your creditor – Creditors can appear very draconian when they come for their money. But can you blame them? After all when you asked them for a loan they gave you on the promise that you would repay. Despite this known fact, creditors are always willing to listen to logical offers provided it shows an end to the debacle in the shortest possible time. This option is particularly useful as no one likes a bad debt. Come up with a convincing plan that must detail how and when the loan will be repaid. It is important to think this true well as a second chance is most likely the last you could get.
These are helpful tips and does not guarantee success. There are also other tips that could help that I am unaware of, so if you have kindly contribute.
This article was originally published by Nairametrics, May 23, 2013
