When I Need Debt?

“Unsecured cash loans to $ 200 million a quick process, please call 081 ……” the brief message written on a cell phone, passing the message is interesting, but surely we must be careful because the loan is identical to the debt then the debt must surely The following can be returned with interest, following it with interest and in accordance with the agreed timeframe.

Then the following question is whether the debt should not I take a lifetime? Which is better we owe cash or cash alias? So what if we are in desperate condition of debt bondage? If in the end we decided to get into debt or add to the debt and how his mind the most appropriate time for the taking?

Well to answer that let us first agree that the concept of debt is borrowing, as such because it is a loan then it becomes an obligation for the borrower (debtor) to return to the lender (lender) and of course the return shall be in accordance with the agreement of debtor and creditor.

Usually in these deals there are factors inherent in it the length of time and the yield or interest rate debt. Debt is very different from the investment, the investment obligations to provide investment returns may go up or down from expectations of being debt generally has a yield (interest) which remain in any condition.
Do not take on new debt with higher interest rates and shorter durations than the old debt

Thus the concept of debt has a very strict (return under any circumstances) then it is a debt obligation that must meet the rule-making work productive, constructive rather than consumptive.

So for a prospective borrower, if you want to take the debt should consider carefully the following factors:
• The use of debt funding, it is ripe consider the allocation of loan funds, there are 3 (three) the possibility that the allocation of loan funds:
A. Productive use of debt to capital investment or working capital;
2. The consumptive use of debt to buy goods that are used without any productive activity of the goods;
3. Constructive use of the debt used to pay old debts that have high levels of interest and repayments are higher than the new debt, the debtor in this case constructive restructure the payment obligations of debt that is running.

• Ability to pay installments of the amount not to exceed 35 percent of income every month, this means very closely related to:
A. Term of the loan and deposit paid (if any);
2. Interest rate debt.

• Management of risk on the debt, ie, if the debtor dies then the debt should have been protected with life insurance with a minimum sum assured equal to the amount of the debt.

In short the prospective borrower will owe should pay attention to the use of funds and ability to pay, if not bound to fall into a debt hole bigger. These two things must be done simultaneously even before the debt is taken.

But sometimes we are in a desperate position to pay the debt, we suppose the pressure of the debt collector and we realize that the above factors we can not meet, but new debt despite higher interest rates should continue to be taken, in this position then our advice is DO NOT TAKE debt new, but talking with the bank to get relief.

If talks with the Bank did not find a satisfactory outcome then it would be nice as the last step you start looking for the Protection of law by contacting legal counsel. Because any kind of debt can be bankrupted by law. Bankrupted the consequences if you are unable to take new loans through the bank for at least 3 (three) years, this is due to the status of your debt in Bank Indonesia is to be 5 (five) alias in standstill condition (bankruptcy).

Thus in a desperate condition: “Do not take on new debt with higher interest rates and shorter durations than the old debt (for whatever reason!), This can be reflected by the amount of new debt repayments exceeded debt repayments of time.”

Thus the reader is wise, things above the main reference if we would take the debt either in normal conditions and in conditions pinched or pressed.

Keep in mind if we use the debt to productive use, then the debt is a potential to accelerate the growth of our assets, in this case serves as a lever of debt (leverage) and will impact on asset growth significantly.

So which is better to use the funds in cash or in debt?, The answer is if we believe that debt is debt that is productive then please you owe, but cash is cash or we shall be allocated on a secure investment instrument eg fixed income mutual funds or can be combined with gold. Function of investment allocation is in addition to hedge also serves as a reduction in accumulated debt burden.

So your readers do not be afraid to owe a debt as long as it is a productive use of the terms you actually calculate the use of funds and ability to pay you in a mature