In the last days the data of non-compliance with credit agreements has been updated. Every month the Bank of Portugal releases these statistics. Unfortunately, the data is worrying and should lead us all to reflect. Ultimately, we have to tackle the problem in order to solve it at the root …
Failure to comply with highest values since November
January and February were the months of increased non-compliance with credit agreements in Portugal, bringing the total amount to the highest since November 2015. Considering that the interest rate on loans has been falling every month, inducing a fall of monthly installments, we should be worried and try to understand to what this inflection was due.
Malparado Rises on Various Types of Credit
Focusing our attention on families, we have seen that non-compliance with credit agreements is now 4.3% of all contracts. Since the home loan is the one that represents the largest slice of all indebtedness, it is worrying to realize that the default is at the highest value of which there is record. In practice, 2.6% of all housing credit contracts are in difficulties. If we assume that this is the high priority of families, we realize that the situation is serious.
Consumer Credit and Credit Cards Bring Financial Ruin
The hiring of a housing loan can be essential to have access to affordable housing (we know that in Portugal it is often cheaper to pay the house to the bank than to pay a rent). However, the contracting of consumer credit or credit for other purposes may be less justifiable by necessity. It is not wrong to borrow money. But it is wrong to ask for a personal loan whose provision we can not protect in our family budget. We speak of responsible credit …
The consequence of non-payment of housing credit is to lose the home. The consequence of non-compliance on a credit card is less burdensome, at least in the short term. This justifies that the levels of default of personal loans are currently at 9.3% and the credit for other purposes at approximately 15%.
What To Do In This Context?
One of the main symptoms of financial disease is not wanting to know about the problems. It is to be afraid to know and face problems. Thus, the first step is to know the problem accurately. Make a financial diagnosis. Then, connoisseurs of reality, we have to tackle the problem head on. With courage!
Renegotiating Credits and Saving a Lot of Money
If you have defaults or late payments (known as having the name on the PLL Bank blacklist), you will know that you can not access the credit. You also can not ask for a consolidated loan. Banks are forbidden by law to lend you money. In this way, the most interesting alternative to reduce your charges is to negotiate all your credits. In fact, it is often more advantageous to negotiate credits than to consolidate.
What if you can Renegotiate and Consolidate Credits?
After negotiating your credits you will be able to “clear” your name from the list of PLL Bank and reduce your credit charges. These two factors together allow you to be a more appealing customer next to the bank. We can talk about a rehabilitation … and after this rehabilitation you can try to consolidate your credits all in one.
What to Complete?
The problems of defaults will be maintained whether we are in austerity or we look to the future with greater optimism. This is because problems do not solve themselves. In this way, we must understand the reasons for non-compliance with credits, draw conclusions and start a path of financial rehabilitation. It may take some time but it is possible to change lives. You can save money … do not you?