Hope Deferred Makes The Heart Sick…

If you’re wondering why I’m quoting King Solomon in one of my posts, here’s why…

In the last month alone I’ve been approached by three consumers who were in trouble with their vehicles.

Two of them had a very relaxed attitude and acted as though they had just fallen behind due to retrenchment and the other couple’s issue was that the wife had lost her job.

Naturally, this affected their household income and budget negatively, and therefore they could no longer afford to meet their monthly debt obligations.

After getting the admin underway, we found out that one of them had not paid their vehicle for over a year and there was already a warrant out and a judgement that was granted.

I found this information, not from my client, as he had conveniently neglected to inform me of this, but from the attorney handling the account, just as I was about to get ready to out-negotiate her.

Boy was I in for a rude surprise…

Even the attorney told me that they had been more than patient with my client, and were made multiple promises by my client, which they just never ended up fulfilling.

This meant that there was now absolutely nothing we could do to save the vehicle!!

The only thing left we could do was wait for the banks to contact them for the outstanding amount due on the contract, and then include that into their repayment.

You see, what most consumers do not understand when their assets are repossessed by the banks, is that the asset will be auctioned, and whatever value is left on the contract between, for example, my client and the bank (or creditor), my client will still be liable for that outstanding balance.

You need to remember this when you finance an asset with the bank…

You don’t technically finance the asset, whether it’s a car or house, you’re technically entering a contract in which you agree to the total outstanding amount, over a total period of months or years, with a total amount of interest. (Unless its’ fixed of course)

So, what you’re actually buying is a contract if I can call it that, with the bank for a stipulated amount, which you need to repay in full.

If you default on this contract, which in most cases is called an ‘instalment sale agreement’, the asset (whether car or house) is used as collateral and will be sold by the bank, which is fully within their rights by the way, for as much as possible.

If there is a balance still outstanding on your contract (instalment sale agreement) with the banks, even though your asset has been auctioned off and sold, and you no longer have it, you are still legally liable for the outstanding balance of your initial contract, to the bank.

Because that’s what your contract states…

In my experience, seven out of ten consumers who finance cars or houses, DO NOT KNOW THIS!!

When they run into financial trouble and can no longer afford to repay the car or house, they simply think or have the attitude that they can just give the car or house back to the bank…

Not knowing that they will still most likely be liable for the balance of the initial contract with the bank.

Fortunately, we could still assist them with their other debt, and we will manage to include the balance from the asset, into their debt rearrangement agreement with the bank, so the load is not as heavy on them.

But it’s so frustrating for me because I absolutely hate when anyone loses an asset when I know that something could have been done to prevent bank repossession!!

So why did I use the term ‘HOPE DEFERRED MAKES THE HEART SICK’…??

Personally, being an eternal optimist, I’m always going to encourage you to be optimistic about your situation, no matter how bad it is. As I genuinely believe that for every problem we will ever face in life, there is a solution to that problem.

We just simply need to find it!!

In most cases, consumers like my above-mentioned clients, were optimistic, not necessarily overly optimistic, but they just lacked a degree of being realistic…

You see, they knew they were in deep trouble, but instead of facing their reality, they chose to ignore what is really happening in their finances, and only focused on the fact that things will eventually get better and work themselves out.

Were they wrong, NO, they were not…

So, what’s the issue?

Well, as I said, they weren’t wrong in their approach, but sadly they lacked a little discernment in the fact that they didn’t realise they would need professional help to get out of their situation, especially, to save their assets.

They relied solely on their own understanding and didn’t’ go about fixing the situation in a sustainable manner, they now, therefore, no longer have their assets, and still owe the banks money!!

And that really hurts…

Trust me, I know because I’ve been there!!

So my whole point of this post is to please encourage you to ensure that if you’re ever in a position where you are struggling to repay your debt, especially if there is a car or house involved, DO NOT HESITATE TO GET PROFESSIONAL HELP.

It makes absolutely no sense to lose an asset that you have worked so hard, for so long, and then now you have to render it back to the bank…

It’s literally like flushing all of the hard-earned money that you spent over the years, paying for that asset, down the toilet.

I know what it feels like when you’re under financial duress… You don’t want to take any creditor’s calls, you don’t want to talk to anyone for that matter…

And there are many reasons for this…

It’s just not worth it, financially and especially psychologically, because you start to feel like a failure.

In closing, I always tell most of my male clients (as they’re the ones who take it the hardest because of the stigma of being the provider and man in the house) that the only time they should feel like a failure, is if they’re struggling, and have people (or kids) who depend on them financially, and yet they still refuse to do anything about their situation.

As that type of behaviour can lead to financial ruin…

Don’t even get me started on the devastating effects of the same scenario, but on a property.

Even today people are still losing their houses due to not seeking the help of a trusted and professional debt specialist.

All the best and cheers to your financial independence…