An accumulation of personal debt leading to over-indebtedness can quickly become a vicious circle, but there are simple steps you can take to get out of it.
Over-indebtedness. What are we talking about exactly?
Over-indebtedness should not be confused with indebtedness. A household may be in debt because it has taken out a loan to finance a purchase. It can be a vehicle, a property or for the simple acquisition of less expensive consumer goods such as household appliances, a telephone, a watch, etc.
On the other hand, if the household can no longer pay its bills and repay its loans due to a lack of income, then there is a case of over-indebtedness.
According to the Swiss Conference of Social Welfare Institutions: "Over-indebtedness occurs when the proportion of disposable income after the subsistence level is not sufficient to meet financial obligations within a reasonable period of time."
In Switzerland.
Few precise statistics on over-indebtedness in our country exist. However, it is commonly accepted that more than 500,000 people in Switzerland live in a household with critical overdrafts or arrears.
The arrears concern first taxes and then health and energy premiums. This is followed by credit cards, rents and non-real estate loans.
The vicious circle.
Over-indebtedness does not only affect households. It is also talked about in economic circles, especially when it comes to assessing the financial health of countries.
Two approaches are regularly cited, namely the need to take on more debt in order to provoke a spiral of investments leading to a higher tax revenue in the long term; these revenues serve to reduce the rate of over-indebtedness in the long term. The other option is to tighten your belt, reduce your expenses in order to better control your debts.
For a household, it is prudent to consider the second option. In the event of over-indebtedness, a race forward that boils down to borrowing more to cover one's costs will inexorably cause over-indebtedness to spiral out of control. Taking a step back and being discerning about your needs, your budget, your expenses is definitely a necessity to start getting by.
You can always hope to win the lottery but let's face it, there is a tiny chance that it will come true.
The virtuous circle.
It all starts with awareness and avoiding falling into a state of panic.
It is imperative that you communicate with your creditors. What is a creditor? This is the person or organization to whom you owe money within a given time frame.
Maintain a relationship where trust is central. This trust is based on transparent communication and gestures, which are synonymous with goodwill.
Before communicating, take the time to study your budget. What can you cut back on spending, what is non-essential?
Prioritize your payments. What are the most urgent deadlines? Which invoices are prioritized? Are my credit codes correct?
When you begin the process of clarifying your financial reality, studying the payments you can and cannot honour, and establishing a line of communication with your creditors, you will then start the process leading to a virtuous circle.
Need help?
Tackling the problem head-on is not easy. Not only are people facing over-indebtedness often emotionally vulnerable, but debt restructuring is sometimes more complex than you think, and it takes courage and time to negotiate with creditors.
Who to turn to for:
Make sure that our debt history is correctly referenced in the databases provided for this purpose?
Ensure that our budget calculations are fair and well thought out.
Reduce our administrative burden in order to be sure that we don't miss any reminder, any warning?
Negotiate with our creditors in order to find a balanced agreement for all?
To receive a quality ear, concerned with our interests and our needs?
Sometimes we need objective and professional support; A support that will not be judgmental and that will be committed to helping us get out of it.
Solvable.
There are experts who are known to the main creditors in Switzerland; individuals who are recognized and respected by debt collection companies and financial institutions. You will find these experts at Solvable.
As Switzerland's leader in debt restructuring, more than 5,000 of their clients receive support each year.
Whether it is a question of checking and correcting your data in official registers such as ZEK or CRIF; whether it is a question of representing yourself in dealings with your creditors or whether it is a question of defining, with you, a payment plan and its execution leading to a complete reduction in debt... Solvent's experts will be able to advise you.
Legitimacy.
As the only wastewater treatment company in Switzerland affiliated to Arif (a self-regulatory organisation subject to FINMA), the company's founder has extensive experience in the field of debt management through his work at the Debt Enforcement Office.
Well versed in credit registers, the language of the codes applied and the circles of professionals concerned, Solvable's specialists will be able to guide you through the process, or even take charge of your entire file.
Solvable is a partner of choice for Milenia, the leading credit provider in Switzerland and the leading financing platform in the country. The two entities share common values whose goal is to serve their clients in a transparent, professional and law-abiding manner.
A breath of fresh air.
Taking the first step is not complicated. It's realizing that sometimes we need help that takes time. However, in the event of over-indebtedness, time is not an ally; We must act!
By making a simple online application , you will take that first step. This does not commit you in any way and you will have the opportunity to share your reality while evolving the best course of action.
Let professionals take the paperwork off your shoulders so you can focus on what keeps you stable: your loved ones and your job, the source of your income.
There will be choices to be made, sometimes difficult but necessary so that you can regain your freedom and a new wind blows in your life.
