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Single Mothers in Debt

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Single Mothers in Debt

The Covid-19 pandemic massively affected the finances of countries, citizens, and industries. Single mothers especially those in developing countries also shared a part in this financial decline. Getting a reliable source of income is very difficult for many single mothers which leads them to take up loans. Also, those who lack financial support from former partners or family members find it difficult to cater to their regular day-to-day expenses. Many of them had to spend their accumulated income on repaying some debts they owed. Research also shows that debt is a common issue among single mothers and 39% of them are left with no other option than to apply for loans.

Effect of Debts On Single Parents

Since the 2020 pandemic, the rate of debts owed by single mothers has increased with 49% taking on more debts. This increase is quite understandable due to the cost of household expenses and cost of living. More families had to take up loans to provide for their needs and some without a stable income to repay their debts.

 

Single parents in debt found it more difficult to cater for themselves and their children. Being in debt certainly affected the living standards of these homes especially homes without child support. Despite many mothers trying hard enough to provide for their children’s well-being, reports show that it creates a greater amount of burden on the shoulders of single parents.

 

According to statistics, 66% of single mothers deprive themselves of basic amenities such as food in order to repay their debts.

It is worth noting that before the disease outbreak, there were also cases of disproportionate debt repayments by single parents. Figures show that about 13% were incurring huge debts on their credit reports. The pandemic only made things a lot worse for them as single parents could no longer afford to repay their debts regularly.

How To Handle These Debt Issues

Debts have an adverse effect on the mental state of the body and single mothers are more vulnerable to this effect. The frequent and constant thought on how to get the needed funds to repay their debt could lead to depression or anxiety. In most cases, single mothers have no reliable family member or partner to discuss these issues with so they are left with handling the repayment on their own. While you may feel a lack of support and constant panicking, you do not have to endure all these alone.

 

Luckily, there are some options available that would help settle your debts and take that burden off your head. Many single mothers are not aware of the opportunities they have to settle their debts. Here are some ways to address debt issues for single parents.

Talk To a Debt Counsellor

Single mothers are often recipients of failed relationships with partners and in some cases, families. This lack of support can present little opportunity or options for them to share their burdens. Fortunately, some advisors provide debt advice and solutions to your issues. Various reputable organizations offer these services to people and single mothers at very little cost.

 

You can always seek the services of these organizations to assist you with managing your debt. Some of these debt counseling agencies also offer to negotiate with your creditors to find a common ground and suitable adjustment for you.

They will address various aspects of your financial life including your personal situations, budgets, income, and so on to discover the best repayment platform for you.

 

Therefore, you do not have to face the constant disturbance and pressure of creditors on you. A major challenge faced by single mothers is the struggle to keep up with household expenses while also looking for ways to pay off their debts.

For single mothers struggling to repay their debts, getting in contact with a debt advisor could really loosen the chokehold around your neck.

Debt Settlement Method

Loans provide a good option to pay off debts without necessarily punishing your personal income. However, incurring debts on your credit reports affects your credit score and the opportunity to secure future loans. The debt settlement method is one of the cheapest and most effective means of improving your credit score.

 

With debt settlement, you can eliminate negative items on your report that may prevent you from securing other loans. Payment history makes up a large chunk of your credit score which means late payments and unsettled debts hurt your credit score. You should consider improving your credit score through debt settlement.

Have a Debt Management Plan

One of the best ways to clear your debts is by having a systematic plan. You should make a list of necessary expenses for your family and cut down on other costs. Then create a saving account for the sole purpose of reimbursing your debts.

 

You can also automate your debit account to allow automatic deduction of a certain amount of money within your repayment deadline.

We also advise that you make a budget to estimate the amount you would need on a different basis.

 

Create a record for your average expenses in a month in comparison to your income. This method will allow you to keep track of your spending and have a clear plan on the amount available to pay up your debt.

How To Secure Loans

Single mothers just like everyone else are eligible for personals. However, there are important steps that set you on the right path to securing a loan without incurring debts.

Take Loans You Can Afford

The first step you should consider before taking loans is to apply for loans you can afford to repay. A common mistake people make when applying for loans is biting off more than they can chew.

Many single mothers are faced with a lot of pressure that pushes them to take up high money loans. Also, some of these loans come with high-interest rates which are difficult to repay. Therefore, you need to access your options of repayment and the loans available to know which one wouldn’t be difficult to repay.

 

One pattern you can follow is to analyze the amount of money you need, the interest rate, and the method of reimbursement. Lenders always add an origination fee to asides the loan amount so you must have that in mind when calculating. You need to calculate the amount you will reimburse in monthly installments and see if it is relative to your income.

Maintain a Good Credit Score

A lot of factors go into keeping a good credit score. It is a prerequisite most lenders use to determine your eligibility and reliability for a loan. A higher credit score gives you a better chance of securing loans for your needs.

However, your chances of getting a loan may be severe with a poor credit score. This factor has pushed many single mothers to apply for other loans that may accept low credit scores.

 

These loans often come with higher interest rates which may be too steep to reimburse whereas a good credit score is mainly all you need to secure good funding.

You can always check your credit score history to know where you stand in the qualification criteria for a favorable loan.

The average credit score demand is often a score of about 680.

Conclusion

There is no doubt that being a single parent is difficult which has made many accept loans they are struggling to repay. The unavailability of a partner to share household responsibilities and conveniently settle their debts. However, with proper analysis and adequate funding, single parents will be able to thrive with little or no issues.