Many district citizens have been on short-time work for months - and are thus in dire straits.
But there are ways out of the crisis.
Self-employed people have also failed due to a lack of orders.
The result: a growing mountain of debt.
The situation often seems hopeless.
But it is not: We spoke to Caritas debt counselor Margit Wander about ways out of the debt trap - and how to avoid the worst mistakes.
Ms. Wander, has the pandemic created additional work for you?
Even before the pandemic, the number of clients was at a high level of around 440 clients who were advised by us.
That is relatively the same as in 2019. However, due to the pandemic, we expect a significant increase in the future.
How do debts arise?
The main causes are separation and divorce, low income and - even more so in the 2020 pandemic - failed self-employment and short-time work.
In many households, income and expenditure are the same.
If part of the income is then missing, for example with short-time work, you can no longer service a loan, for example.
It's very quick.
And then it gets tight, especially in our district, where the cost of living is very high.
What do people do in this emergency?
Many just wait a while.
You start saving.
Often they continue to service the loans, but no longer pay the rent - which is a mistake.
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Margit Wander is a debt counselor at Caritas Freising.
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How so?
Because then they set the priorities wrong.
First of all, I have to take care of the existential things: rent, electricity and food.
And the banks have to wait?
If it is pointed at the button, then you have to stop the loan payments.
Then the credit bursts.
This means?
.
.
.
that after two months the bank can call the entire loan amount due, i.e. demand it.
But that sounds very worrying.
Yes, that initially causes stomach ache for many.
And it is also the latest time to seek professional help - Caritas debt counseling, for example.
How can you help?
We look at the matter.
How much income is there?
What can you offer the bank?
You have better cards if you have debt counseling behind you.
Finally, we create a regulatory plan to slowly pay off the debt.
But what if that doesn't work because the mountain of debt is too high?
Then it goes into bankruptcy proceedings.
And that - very important!
- has now shortened.
If you stick to all the rules of the game, that is, if you are an “honest debtor”, as that is, there is now a residual debt discharge after three years.
Does that mean the debt is canceled and the bank looks down the drain?
Yes, you could say it that way.
But during these three years you are accompanied by a so-called insolvency administrator, a lawyer.
Everything that he can take away from the debtor as attachable during this time, he also grabs and pours it out to the creditors.
Of course, that means a very limited life.
But you can see a light on the horizon during this time.
Since the beginning of this year the duration of the insolvency proceedings was shortened to three years, many have taken this opportunity to end their debtor life in the foreseeable future.
This is now a great incentive - and it gives us a lot of work at the moment.
Has your clientele changed?
There are already more people who have never had anything to do with debt before.
They often had a steady income for 20 years and set up their lives afterwards.
If the short-time work lasts longer, the previously functioning concept of life quickly collapses.
Some then tried to become self-employed in their need.
Often, however, the necessary know-how was missing - and the debts accumulated even more.
What mistakes should you avoid in order not to slip into the red?
Always keep an eye on the budget: Income has to cover expenses.
An overdrawn credit line is a warning sign.
Also important: always pay bills immediately before reminders arrive.
Once debt collection agencies are involved, 20 euros quickly become 120 euros.
Then the costs explode.
Above all, you shouldn't hide your precarious financial situation.
Friends often provide the right food for thought.
Many come to us because good friends advised them to do so.
How soon can you help? Do you have months of waiting like many debt counseling?
No, we have organized it really well: from Monday to Friday between 8 a.m. and 9 a.m. there is a daily telephone consultation on Tel. (0 81 61) 5 38 79 45 to answer initial questions.
We assign the appointments for an initial meeting once a month - every last Wednesday from 3 to 5 p.m.
You just have to be able to wait for this day and stick to the bar.
However, there is a high probability that you will get an appointment in the next month.
We don't have a long waiting list.
Do you have any special offers?
There is also an online consultation, where you can also remain anonymous.
And there is advice for younger debtors between the ages of 18 and 25.
We used to have an open consultation here, but now, due to the pandemic, it is only possible to make an appointment.
We always offer short-term appointments for P-account certificates because it is very important to secure a subsistence level on the account.
You have been a debt counselor for 13 years. What has changed since then?
Basically, it's always the same: Part of the income is lost.
Everything is sewn to the edge - and debts arise.
But the scope is growing.
It has become a real challenge.
Finally, some advice from the expert?
Debt can be pushed aside for a moment, but that is no solution.
The avalanche cannot be stopped.
You have to face the problem, preferably with professional help.
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