España

How can over-indebtedness be prevented?

We have drawn up a ten-point plan to help consumers act in a conscious way, so that their money can increase in value, they can manage their debts better and avoid falling too far into debt

TEN POINT PLAN

 

1. Analyse the real financial situation before asking for a loan. It is very useful to draw up a budget of incomings and outgoings, bearing in mind unexpected expenditure, so as to know the free available amount to avoid over-indebtedness. Prevention is better than cure.

Comisión EuropeaEscuela Europea de ConsumidoresGobierno de CantabriaMAG (Estudios de Consumo) S.L.IFAVConsomation et Logement Cadre de VieAssociation d'avocats

 

We have drawn up a ten-point plan to help consumers act in a conscious way and they can and avoid falling too far into debt.

  

2. Make sure to understand the strategies used in advertising offers in our country, to avoid being taken in.

3. Look for information on loans, financing forms, inherent costs, means of repayment and pertinent rights. This manual may be of use in this sense.

4. Get correct information (from consumer organisations, public organisms or emigrant support) before: asking for a loan, buying in instalments, by mail order by Internet etc. (the norms could easily change and the contents of this material consequently obsolete.

5. Compare the advantages and disadvantages of different banks and finance entities before asking for a loan. Analyse the costs for overdrafts.

6. Act with precaution with loan merchants, we must know that they are not finance entities. A loan contracted via a loan merchant is more expensive since it is necessary to pay his costs.

7. In the case of difficulty in paying back a loan, do not let time pass, inform the bank or lending institution and look for an agreement as to the future of the loan. Asking for a second loan in order to pay back the first usually makes the financial situation worse.

8. Do not fall into the traps of cowboy companies which offer (via aggressive advertising) "easy " loans which are not so, since they usually have very high interest and conditions which affect your statutory rights.

9. When the situation of over-indebtedness worsens seek advice from organisms that can help. Look for information. Think that the problem can be solved and do not take rash action. Always reflect on the situation before acting.

10. The writers of this information can offer free and up to date information on this area (in German, French and Spanish).
Consult the website: www.infoconsumo.es/emigrantes