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Consequences of Poor Money Management (Bankruptcy (The state of having no…
Consequences of Poor Money Management
Unmanageable Debt
Unmanageable Debt occurs when a person has more monthly debt payments then what they can keep up with.
It is important to avoid Unmanageable Debt as it can cause serious harm on a person. Things such as Mental health issues and the persons welfare can kick in.
You can avoid Unmanageable Debt by only paying for stuff you can afford and
Bankruptcy
The state of having no money to spend
A process that occurs overtime due to bad purchase decisions, investment decisions, etc.
It is bad because it causes people to become desperate for money and owe more debt.
Person who is bankrupt, their family and friends. Also, banks and lending money companies are all affected.
Repossession
This is when a party has control over your property and has the power to take it away.
Usually the bank members come in and take some of your property as a consequence of poor money management or debt that hasn't been paid
This is a problem because belongings can be stripped away from a person that could be essential to living..
The person who has poor money management and possibly their family can be significantly effected.
Harassment of Debt Collectors
If you fall behind with your payments, your debt may be transferred to a debt collector. It is a business that operates to recover money that is owed, you will then owe a debt to that business.
The person that is affected is you and possibly the people around you because you owe a debt and may not be able to pay is back.
This is a problem because you owe a debt that you may not be able to pay.
Letter of Demand/Default
Notice
Letter of Demand is how a Debt Collector will get into contact with you
Debt collectors must respect your right to privacy. By law, they cannot reveal that they are a debt collector or provide information about your financial situation to another person without your permission.
This is a problem because you are getting chased because you failed to by back your debt
This will affect only you because you a the one getting the letter
Foreclosure/Mortgagee
Sale
Foreclosure/Mortgagee sale is when a property owner defaults under the mortgage, and the bank sells the property up
When a property owner has poor money management the bank takes over the property no matter how much mortgage has been paid, the bank sells the property.
This consequence is a problem because the owner of the property loses it's property and money put towards the mortgage which could result in bankruptcy or becoming homeless.
This consequence affects the home owners significantly due to the loss of money and possibly becoming homeless.
Inability to Get Credit
It can affect you and your family.
This can deny you job opportunities in the future.
Bankrupt can permanently affect whether you can get credit in the future
Social/Personal Issues
Personal issues can be health issues, family issues and finally physical issues
Personal issues can lead to people loosing their lives and other complications
Social issues can be, friends starting to dislike you, getting excluded and being treated differently.
Social issues can cause many side effects as you can be treated as liar or other names