Credit spiral. How to get out of debt?

Sometimes we are convinced that something will never happen to us. This is a problem for many other people, but not ours. Unfortunately, it often turns out differently. One of the situations that everyone would like to avoid, and which is very easy, are credit. Almost 3 million Poles have problems regulating loan and credit repayments. When we have more and more liabilities, it is very easy to lose control over finances.

There is a reason why so many countrymen can’t cope with it. As a rule, the spiral of credit begins very innocently. Installment purchases, 0% credit, incentive to use a larger account limit, free loan, etc., money is often easily available, but when repayment comes, the stairs begin. Before we think about how to get rid of financial problems, it’s worth thinking about how the spiral creation mechanism works. Thanks to this, you can avoid future problems.

How does it start


The credit spiral does not start with gigantic problems. It starts very simply, and the sooner the red lamp lights up and we say “stop”, the easier it will be to deal with this problem. Financial institutions tempt us with interesting offers, so we gladly use them. After all, it is only a few hundred zlotys, maybe a thousand, it is not much, and at the same time ideal amounts to repair the budget. If you can get one loan so quickly, why not take another one.

The previous one will be repaid and the repayment date will be postponed. At first glance, this sounds logical, which is why so many people fall into this trap. Each subsequent loan involves the necessity of borrowing a higher amount. Sometimes, several applications are submitted simultaneously, and we are unaware of what is happening, we increase our credit ourselves and a spiral of credit appears.

Exit from payday spiral

Exit from payday spiral

Before we get to the stage when we ask the question how to get out of the credit spiral, we must be aware of it. Contrary to appearances, this is not so obvious, and many creditors believe for a long time in the beneficial effects of the “repayment” mechanism as above. To successfully start getting rid of credit, we must stop borrowing. You have to break this vicious circle as soon as possible.

Besides, we can’t hide our heads in the sand. Just because we don’t receive calls or notifications doesn’t mean that the backlog has disappeared. Their interest is constantly increasing, and creditors lose patience and eventually we can lose everything through a bailiff. The spiral of credit is something that can be overcome, but you need to take this first decisive step – admit the problems and decide to solve them.

How to get out of credit?

How to get out of credit?

When we get to the stage that we are determined to finish winding the spiral, we should talk to loved ones. Perhaps, like many others, we are ashamed of having credit and our family and friends are not aware of what we are dealing with. If we openly say that we cannot go to the cinema or theater at the moment, we cannot afford dinners in the city, etc., our loved ones will show support, and this is a lot.

Then we need to make a balance of expenses and all revenues on a monthly basis. Since we decided that we would pay back the arrears, we have to do it. Before we start talking to creditors, we need to know what our options are, what amounts are realistic to pay.

The next step is to draw up a list of creditors, together with the amounts we need to return. If we have a lot of backlog, it may turn out to be a difficult challenge. With older arrears, creditors could change and, for example, instead of a loan company, we should contact the credit collection company. The amount itself will certainly be larger than the one we borrowed. The most effective way will be to generate a report from BIK about us. Everyone who has a past due obligation goes to the creditors’ bases. Similarly, we will find the creditor’s current amounts and name.

When contacting each of the creditors, the most important will be the willingness to pay back. If we tell about our situation and show that we will pay back, the person on the other side will be more favorable. Contact from our side will significantly help us in negotiating the conditions, and on the other hand will help us to protect against bailiffs, for example.

Look for savings

Look for savings

To get money to get rid of all credit, we need to look for sources of savings. Let’s start by writing down everything we buy, all exit tickets, bills, etc. Probably, although in part cheaper substitutes can be found, at least for the time of getting out of credit. For example, instead of car fuel, it will be cheaper to buy a bus ticket.

If, nevertheless, there is still a lack of money, we would be interested in occasional or additional work. Currently, there are a lot of offers of this type of classes, and thanks to them we are able to collect faster. In order to feel more that we are freeing ourselves of credit, we can indicate which amounts are settled with the commitments already written. This will be eye-catching evidence that the credit spiral is becoming a thing of the past and we are recovering financially.