How to act if you are in debt? It is a question that no one would like to ask. However, it may happen that circumstances or careless management of one’s finances can lead to excessive debt exposure. How should we behave in these situations? Is it possible to find a way to optimally manage all one’s financial commitments and saving bonds? If you are interested and want to understand what to do if you are in debt, all you have to do is continue reading.

The different types of debt

First of all, let’s do some order. There are several types of debt that can be incurred. First of all, there are loans, which are subscribed on a voluntary basis by subjects who need liquidity for various purposes. Then there are the so-called involuntary withholdings, foreclosures. These are judicial acts by which a part of the monthly income (salary or pension) is withheld for a certain period, for example, to pay an unpaid fine.

Obviously, both of these types of financial commitments weigh on one’s standard of living, since they take up a portion of one’s monthly income. How to behave in these situations? Read on and we’ll explain it to you.

How to act if you are full of debt: the assignment of the fifth

The is a loan that allows you to pay off other existing loans, also obtaining additional liquidity. The monthly installment of the sale is deducted from the paycheck or pension on a monthly basis, a very convenient repayment method.

Once the sale has been requested, there are two ways to pay off the other active loans:

  • If the other loans do not have a direct deduction on the monthly income, the liquidity is received and part of it is used to pay off the other loans;
  • In the event that the other loans directly affect the salary or pension, the finance company or bank that makes the sale first extinguishes them and then liquidates the remaining portion of the loan requested.

In this way, it is possible to combine all the commitments in a single installment and also receive additional liquidity to set aside or to use at will.

If there are foreclosures, however, can the sale extinguish them? Read on and you’ll find out.

How to act if you are in debt: foreclosures

As we have already said, not all debts are voluntary in nature. Foreclosures are judicial acts with which a part of one’s monthly income is forcibly withheld until a certain sum is reached. Also, in this case, the assignment of the fifth allows to pay off the debt and, if the conditions are met, to receive further liquidity.

Since foreclosure is a form of direct withholding from one’s salary or monthly pension, the bank or financial institution that disburses the assignment first extinguishes it and then pays the remaining liquidity to the applicant. If you want to know more or are looking for support to understand how to optimize the management of your monthly commitments, contact us, our consultants are always available