- According to the specialists, the most significant reasons for not repaying a debt are the deliberate avoidance of either the problem (maybe the debt will somehow disappear) or contact with a debt collection agency, waiting for a debt to become time-barred and the lack of conviction that one can manage a debt.
- Whatever the reasons for not repaying our debts may be, eventually we have to pay them back, as no debts disappear on their own.
- A meeting with an advisor usually helps us in finding a solution adequate for our situation and possibilities.
We are expert at faking the reasons for non-repayment of debts. Some of the specialists from BEST S.A., a debt collection agency, have prepared a Top 10 list.
1. I can hardly make ends meet, I really can’t afford it. A difficult financial situation, sometimes related to the loss of a job, is one of the many common reasons given to avoid repaying our liabilities. In many cases the situation is difficult indeed, and we may need time to get back on our feet. Sometimes, though, despite our belief in our difficult financial situation, we still spend a considerable amount of money on pleasures, entertainment and other things, instead of repaying a loan.
2. I’ll do it next month. December is Christmas and New Year’s Eve, and there are always expenses related to these celebrations. January and February are the winter holidays. April is Easter and May – well May is a bank holiday weekend, when we can finally go and rest somewhere. Next we have First Communion celebrations, summer holidays, school starter kits... As a result, almost every month has some additional expenses. This is a poor strategy - because while we postpone the repayment of our debt, it only becomes greater.
3. I’ll pay it back when I get some big cash. According to specialists from the debt collection industry, many debtors postpone their repayments until they get some big cash. This is a mistake, because winning a lottery or an unexpected inheritance from a forgotten uncle only happens extremely rarely. Waiting for them is a very bad method of repaying our debts.
4. My debt is too big, I can’t repay it, so I’m not going to care about it. Unfortunately, if we do not pay our debts, then they just grow and grow with interest. Whatever the debt, it has to be repaid eventually. No creditor agrees to remit a whole debt just because the amount to be paid is beyond the debtor’s current financial capabilities. Nonetheless, contact with an advisor is helpful when we want to find a solution - such as paying instalments in amounts that we can afford, or suspending interest charges in return for the monthly payment of a minimum amount.
5. It’s impossible to come to an understanding with debt collection agencies. Unfortunately, this is just another poor excuse, while logic tells us a different story. Debt collection agencies want to get their money back, or at least some of their money, so they are usually willing to negotiate. If we remain silent, then interest keeps getting added to our debt.
6. Many other people also don’t pay, I am just one of them. It is true that in Poland there are many debtors – currently about 2.2 million of them. But this does not mean we can avoid our obligation to repay our liabilities, or that our debt will in some way expire so that no one need pay it back. Debts are money, so has owners. Do not expect them to give it up.
7. The “keep up with the Joneses” tradition. Few of us like to admit publicly that they have financial problems. That is why, when family celebrations are about to take place, we prefer to take out more credit or a loan than to admit honestly that we can’t afford expensive presents. We want to prove our superior status, although the reality may be very different.
8. I won’t pay those who acquired my debts, it’s a grey market (they paid peanuts for it and they want to be fully paid back for it). Sometimes this excuse is used by people unwilling to repay their liabilities, but it is unjustified. Polish law allows debts to be acquired by third party companies from those companies which granted the load or a credit. Such entities are entitled to carry out effective collection proceedings. These are big financial institutions, controlled by the Polish Financial Supervision Authority, and are listed on the stock exchange.
9. I won’t pay it back because the money was for my friend/brother/father etc. Taking out credit for a third party is a personal responsibility, and such a liability has to be repaid. It is worth thinking twice about it. As long as you are helping somebody, the relationship thrives, but then many people break off contact with their relatives because of outstanding debts. In interpersonal conflicts, especially family ones, financial issues often play a key role.
10. I thought that I would be able to repay - it’s not my fault that the car broke down. Before making a decision concerning taking out any credit, it’s worth sitting down with pencil and paper (or a web tool such as http://kalkulator.best.com.pl/?_ga=1.136160118.674204145.1481286767), and calculating our costs of living, bills that have to be paid, other payments, costs of care and fortuitous events (such as illnesses, and car or fridge breakdowns). This will help us to answer to the question: will I be able to pay the instalments? If we add the instalment to our monthly expenses and still break even, then perhaps we won’t have enough money – because while at first glance it appears that we can afford the credit, sometimes it just takes a minor unfortunate event to start the problems – a child’s illness or a car breaking down, generating unexpected outlays. As a consequence, our debts become so enormous that it is difficult to manage them.
"When we talk to our debtors, we hear many arguments against repaying outstanding debts. We always try to hear that person out and find an appropriate solution, taking into consideration their current life situation. Sometimes we decide to offer a possibility to pay in suitable instalments, sometimes to write off a part of the liabilities in return for payment of the rest of a debt. Anyway – if we borrow, we have to give back, the problem will not disappear on its own. When we postpone our obligation and avoid contact with a debt collection agency, it only means that more interest gets added to our debt. It is usually enough to take a one, small step - such as making contact with an advisor. Next, determination and regularity are necessary. If one follows the advice, it is not so difficult to repay our debts", comments Katarzyna Gulbicka from Best S.A.