Debt trouble skyrockets

The debt situation is getting worse according to new figures released by Statistics South Africa. The ongoing study into civil cases for debt measures how many people have been taken to court for debt troubles and how much they were taken for. The figures are sobering with both measures showing dramatic increases. Debt problems can be managed but they need to be approached pro-actively before the summons arrives. So what are the statistics?

• 17.6% increases in summonses y-o-y
• 32.4% increases in value of judgements y-o-y
• R 656.3 million in judgements in August 2009

What can clearly be seen here is that the debt problem is getting worse, as we stagger through the recession more and more people are being taken to court for non payment of their debts, the value of those debts is also rising at a rapid rate. Lenders will, in general, view legal action as a last resort due to the costs associated with recovering debt legally but as the recession bites they are being less lenient in pursuing their money.

So if you are feeling the pinch and want to deal with you debt trouble before it deals with you then you can at least do a number of things. Contact the people you owe money to and try to renegotiate payment terms, you can also employ the services of a professional debt management specialist who will be able to negotiate on your behalf and protect your assets if the people you owe money to are pursuing the legal route. Deal with it as quickly as you can rather than wait to get bitten.