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People who experience stress due to their situation, will probably seek advice from their GP and may take time off work, therefore, this has an effect on already hard-pressed NHS and productivity due to absenteeism.
People who have had homes repossessed need to be re-housed, generally by local Council. Those who seek legal aid due to debt issues also incur a cost to taxpayer.
The Solution before Problem Will raising financial awareness alone tackle issues of debt problems? It helps for people who are already struggling with debt, but are there other areas Government should be looking at?
If you pay your creditors on time, regardless of what it takes to pay them, you are classed as a good payer and therefore, not a risk when it comes to additional borrowing. In fact, your finances could be in turmoil and you could be taking money from one card to pay another but you may still obtain even more credit. The freedom creditors have to advertise loans, credit cards and mortgages could be challenged as well as how decisions are made regarding lending.
If people, who are currently in financial difficulty, find they cannot borrow more money, they should be made aware of free financial advice that is available. Free Debt Management Companies such as Payplan www.payplan.com can negotiate repayments with creditors so that monthly payments are reduced and become more manageable.
Nicola Bullimore has been working with people to resolve debt problems for a few years. For more information regarding debt issues, please visit www.debtquestions.co.uk