A day without debts comes. It should be emphasized that a third of the Czechs currently pay some form of credit and are far from successful. Those who pay after maturity will be advising financial experts on Monday, November 12, in 22 offices of the Labor Office throughout the country. In cooperation with other organizations, KRUK has been organizing for the tenth year.
"Experts will be prepared at the points of contact to assess the financial situation of people according to their income and the obligations they have to pay, which results in a concrete step-by-step plan, where to reduce costs, how to get another source of income, or how to break down the liabilities longer time, "says Jana Zaludova, a spokeswoman for Kruk.
Loans are also considered among relatives
Cooperation with the Office of Labor is not a coincidence. In many cases, the loss of employment may result from the difficult financial situation of people. The choice of specific contact points available to people is based on unemployment statistics and debt ratio of individual regions.
Given the interests of previous years, it often happens that financial advisors turn to mothers in the household who do not have debts, but they wonder how to prevent them. Other people settle unpaid overpayments, executions or insolvency. Loans are often dealt with by relatives.
Regular analyzes of Krka's claims management show that the average debt of Czech borrowers amounts to 29,700 CZK. In 2016, the average debt amounted to CZK 25,700.
It is also true that men are increasingly indebted – 54% of borrowers have an average debt of CZK 31,500. The share of women is 46% and it owes an average of CZK 27,200. Most borrowers, 16% from the whole of the Czech Republic, with an average debt of CZK 28,100, come from the Moravian-Silesian region. On average, the highest liabilities are borrowers from Prague, namely 33,100 kroons, which represents 7% of all debtors in the republic.
We hardly have food, some debtors say
Kruk also conducted a survey on the financial situation of Czech households. Savings, most often in the form of a cash deposit in a bank or on a savings account, account for two thirds of the respondents. Men are more secure than women and usually people with a higher or higher level of education, as well as self-employed.
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According to experts, at best there should be a financial reserve with three monthly salaries. According to the survey, there are 28% of people. One-third of the respondents are saved during the quarterly and annual revenues. A fifth of households even have savings of more than one annual income.
The survey also focused in detail on debtors. The numbers are certainly not happy. A fifth can buy only the cheapest and most expensive food and clothes from their income. And 5% of the debtors have no money or these basic needs.
People are most likely to borrow loans for the purchase of long-term goods, usually cars or household appliances, and for the renovation of a dwelling or house. Debts are also a source of family disputes. The subject of costs is, above all, the consumption of unnecessary items and the concealment of information about spending before a partner.
"Problems with the domestic budget are more frequent in younger households and families with more than one family member, more than a fifth of respondents with debt said that they have a financial crisis in their households at least once a month," said a representative of Zalud's Zalud company.
How will new rules on personal bankruptcy arise?
- The debt write-off procedure will last for five years and the borrower must pay at least 30 percent of the liability in this period. A change in the current situation will mean that the debtor at the beginning of the procedure will not have to prove that he can pay 30 percent of the debt. However, it must have sufficient income to pay, in addition to the salary each month, to the insolvency administrator the same amount as creditors. In total this will be CZK 2,178 per month.
- If the debtor fails to pay the required 30 percent of the debt after five years, the court will decide on his fate. If the judge decides that the borrower has not tried enough, the remaining debts will not be released. This, according to critics, brings uncertainty to the process.
- A new shorter triple version will be added. It can be used by borrowers who can return 60% of their liabilities at that time.
- There is also a proposal for Mrs Kateřina Valachová. At the same time, it wants to reduce the debt up to three years for retired and disabled.
- Only persons whose debts are less than a thousand times the minimum of life, i.e. 2.2 million kronor, can be proclaimed only for personal bankruptcy. This limitation has been canceled by the proposal of Deputy Jan Farský. In his opinion, this limit is only virtual and the vast majority of people have lower debts.