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Credit Bureau - an organisation that keeps on file the credit history of customers
The credit bureau provides credit information to organisations for a fee. Organisations use this information to decide whether they accept or reject a credit application
Consolidate loans - means to put multiple loans into a single form of debt. All repayments then go into one form of debt
Use credit sensibly
Budget, monitor expenses, save money
Individuals have certain obligations that they must fulfill, failure to meet these obligations will often result in legal action in order to recover the money that you owe.
What are the features of responsible financial management?
Advise your lenders. Hopefully, you and the lenders can work out a new repayment plan. If it is a short-term financial issue, maybe the lenders will defer your payments
Consequences of being declared bankrupt: If you are declared bankrupt at an early age, it will make it much harder to get a loan in the future and affect your financial independence.
Default notice: a document from a lender stating that a person has failed to carry out the terms of the contract
What are some social consequences faced by Rebecca Bloomwood?
If you are given a default notice, these are your options:
1. Pay money owing
2. Negotiate a change in your repayments
3. Apply for a hardship variation
4. Negotiate a postponement of repossession
5. Refinance the loan
6. Sell your goods and repay the loan
7. Voluntary surrender (give the goods to the lender and ask them to sell them)
8. Apply for bankruptcy
Financial
Social
Legal
Garnished - When a certain amount of money is taken out of the borrower's wages, until the full amount of the loan is paid back.
Repossession means to take back something. It is often the goods you bought on credit if repayments have not been made.
Additional costs you might also have to pay back the lender the difference between what they sell the goods for and the amount of debt, as well as what it costs the lender to repossess the item
People who can't manage money:
1. end up losing goods
2. being sued
3. declared bankrupt