The popular media has certainly added to the scale of the current global credit epidemic. Headlines say states are mired in debt, editorials criticize “irresponsible borrowers,” “reckless lenders,” and even today’s “consumer culture” is to blame. However, financial institutions do not share this view as it is important to distinguish between “debt” and “bad debt”, because simple options such as debt increase insurances exist to help people along their lives and make their lives easier.
Bankers believe that the use of most types of insurances is not a problem, and even negative credit reversal is not a problem in many cases. According to research, 95% of the adult population in the United States (the same amount it was ten years ago) believes that their debt is not “heavy burden”. The minority whose debt is a problem.
According to a recent study, only 4% of adults reported having consumer debt that was overdue for more than three months. Bankers argue that the peace of mind afforded by having access to cash when you need it, even with bad credit, cannot be discussed. But social commentators are more skeptical.
According to some observations, this is a social issue that affects some groups more than others. Representatives of financially distressed groups are also more susceptible to debts with “guarantors” and family accounts. This choice often leads to very serious legal consequences.
As with other forms of inequality, bad debts can affect the most vulnerable members of society. Health systems analysts also argue that debt has implications for the health and social well-being of an individual. An analysis of the existing literature on poverty as a cause of poor physical and mental health in people will reveal further historical evidence of this.
Analysts say there is a similar relationship between your financial records and your health. Furthermore, they claim that debt can be a risk factor for social isolation, creating a sense of danger, shame, and even suicidal intent. Thus, the issue can be viewed from financial, medical and social points of view.
It is quite obvious that the reason why a debt increase insurance is so beneficial. The mere peace of mind of getting all of your debts in a manageable format is good for your mental and physical health, in a very real way. Having this option, even with a poor credit profile, can help many get back on their feet again, if they are careful about it.