Before we get into the signs that you’re getting into a debt trap, let’s take a quick look at what a debt trap is. Instant Debt Management Services sees it as its top priority to keep its clients from getting into financial trouble in the future.
What are debt traps?
Debt traps are a serious issue that is easily misunderstood. In general, the majority of borrowers are completely unaware that they are falling into this trap. So, if you want to be financially stable, you need to be aware of the signs that you might be getting into a debt trap.
It can be challenging to keep track of multiple loans if a person takes out a new loan to pay off an existing one. Instant Debt Management Services is here to assist you. With our help, you can replace all of your multiple loans with one simple loan, making it much easier to keep track of payments and make them on time.
Our experts will analyze your situation thoroughly and provide you with a consultation.
Moving on to the Manifestations of a Debt Trap
1 You are unable to pay credit card dues
If you do not pay your credit card debts on time, you are on the verge of falling into a debt trap. Due to the high-interest rate, it ends up costing a lot to pay back what you owe on your credit card. When you are having difficulty paying your credit card payments, you need to take a critical look at your finances.
2 Getting loans to cover everyday costs
You are likely to get into a debt trap if you regularly use your credit card for purchases and if you borrow money in the form of personal loans, credit card loans, or small-amount loans.
When people don’t have enough cash at the end of the month, they may turn to credit cards or even consider taking out a personal loan to cover their expenses. But you need to know that it’s quite dangerous and may possibly lead you into a debt trap. It can be convenient at the time, but repaying the interest on a short-term loan can be a burden in the long run. because you must repay far more than you borrowed
In this worrisome situation, Instant Debt Management Services can help you figure out where your money is going wrong and give you advice before you get into legal trouble.
3 Borrowing to pay off another loan
If you frequently borrow money to cover another loan, then you need to catch up in your personal finances. You may soon find yourself in a debt cycle in order to pay off your liabilities. You are not just increasing your liabilities but also decreasing your lending potential. One strategy to keep the loan situation under control is to keep the monthly installments within 30–40% of your monthly income. If despite all these efforts, you still fail to pay your debts, there is no need to be worried since Instant Debt Management Services are always available to assist you in avoiding default.
4 Banks turn down your loan application
If banks turn down your loan application, it’s likely that you already have a lot of financial obligations. Banks figure out how much you can borrow based on how much money you make and how many loans you already have. If you have taken out too many loans for small needs, you may have reached the limit of what you can borrow, causing banks to turn down any new loan requests.
But Instant debt management can help you settle your loans and consolidate all of your credit cards and loans into one.
5 EMIs over half of monthly income
Many people have multiple types of loans; we cannot avoid taking “good loans” because they are often essential. However, many people continue to borrow for all of their purchases on a regular basis, which is not a sign of good financial health. Most financial advisors recommend that your total EMIs should not exceed 50% of your monthly income. Suppose your total EMIs, which include home loans, vehicle loans, personal loans, and credit card loans, exceed this limit. In that case, you should take this warning seriously and develop financial discipline to prevent sliding into a debt trap.
Instant Debt Management Services has helped thousands of people get rid of debts and credit cards, which has positively impacted our clients’ mental health.
Call us today to book a free consultation: +971 56 345 5474