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Posts Tagged ‘debt repayment’

The words “neither a borrower nor a lender be” are wise words indeed. When you are in need of debt help, it is very tempting to turn to your family, as they are the people you expect to be able to rely on. How can they refuse you help when you need it most? However, it is not excessive to warn that even close family relationships can break down over financial issues.

If you are in serious debt, then professional advice should be sought from a charity or non-profit organisation. Borrowing more money is not a solution, as it does not actually pay off the debt, and it is very easy to assume that the relative will not mind waiting for repayment, or that as you are family, the debt need not be repaid at all. This would leave huge resentment and may cause lasting damage to the relationship.

Where borrowing money from family can work is if it is for relatively small amounts, and only needed for a short-term loan. For example, perhaps you need the money to repair your car, so that you can get to work, but you know that you will have the funds to repay the loan on pay day, or when some other expected money comes through. You must also be sure that you can pay back the money quickly, without causing further financial problems.

The loan should be treated as any other loan, with absolute intention to repay it, and the relative´s tolerance should in no way be taken for granted.

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Debt awaits you

Losing a relative is difficult enough to cope with on its own without being landed with unexpected debt problems as well.

If a person has died without making a will, they are considered intestate. This can cause many problems for partners and families. For example, if a couple lived together and a partner died, everything that the deceased owned would go to their next of kin. This means that a loving partner could become homeless and face severe debt as the law does not protect common-law relationships.

If on the other hand, you lived in a property which was rented by your deceased partner, you may have the option to take over the tenancy. If you do this, you will be responsible for any debt which may have accumulated through missed rental payments

If any loans or credit cards were taken out in joint names, you will be solely responsible for debt repayments.

Do married couples face debt as well?

Things aren’t always so smooth for married couples either. If a husband or wife died and had accumulated council tax debt, his or her spouse will be responsible for clearing that sum.

If someone’s death has left you in debt, it would be wise to seek debt help so as you can keep your credit file in tact whilst you come to terms with the huge changes in your life.

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