Frugal | Do You Realize That You Are In Debt?

Do You Realize That You Are In Debt?

Posted by Lynnae on August 23, 2007

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According to Dictionary.com, the definition of debt is “something that is owed or that one is bound to pay to or perform for another.” (emphasis mine) Bound to pay. Think about that for a minute.

When a person takes out a loan, whether it’s a mortgage, auto loan, credit card loan, or any other kind, he owes the lender. He is bound to pay. Under contract. In debt.

We all know the legalities of the situation. If you don’t pay your debt, the big bad creditors come after you and hound you until you pay the money. And we often hear all about the nasty creditors. True, there are some credit collection agencies that engage in questionable practices. I know. The person who owned my phone number before me evidently owed a lot of people money, and we got calls at all hours.

The credit collections agencies who play by the rules, though, are just doing their jobs. They are collecting money that is rightly due their clients. For this reason, I have a hard time calling the credit collection agencies the bad guys. Unless, of course, they’re calling you at 2 am or threatening your job by calling you there. But in general, the agents are just doing their jobs, trying to make a living for their families.

The big question is how good is your word? When you take out a loan, you say you will pay it back. Is your word good? Are you going to do what you say you’re going to do? I don’t ask this to make anyone feel bad. This is really one of the big motivators my husband and I have for getting out of debt. We both consider ourselves to be people of integrity, and the fact is, we promised Master-card and we promised the U.S. Department of Education that we would pay the money back. It’s taking longer than we had planned, but we intend to pay our bills in full.

Too often we don’t think of debt in those terms. Is your integrity on the line? Do you realize that you are in DEBT? Bound to pay? I want to live up to my promises. How about you?

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Comments

2 Responses to “Do You Realize That You Are In Debt?”

  1. glblguy on August 23rd, 2007 12:43 pm

    Really good write-up. Debt is really pretty personal. When you borrow money, you are borrowing someone else’s money. People don’t seem to think of it that way, but the reality is you are using someone else’s money.

    Biblically and just plain ethically, we have to pay it back…Romans 13:8.

    I am constantly amazed at the number of people that file for bankruptcy just to avoid paying it back…to me that is the same as stealing.

  2. Philip Brewer on August 25th, 2007 1:35 pm

    I’m of two minds.

    On the one hand, I believe in paying back what I owe.

    But the way credit card companies (and other lenders) operate now makes it hard to be absolute about it. They can change the terms of the loan just by sending you a note in the mail–and those new terms are incredibly onerous.

    Any little glitch such as a missed payment–even a dispute with a credit card company about a bogus charge–can not only trigger a bunch of fees, but also a huge jump in the interest rates of all your other cards. All of a sudden your low fixed-rate card is now charging you 29%.

    I’m all in favor of paying what you owe. But I’ve heard too many stories like that to jump to the conclusion that what you’re ethically obliged to pay back is necessarily the same as what the credit card company says you’re obliged to pay back–even if they’ve got the law on their side.

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