Hila Seyda, an accountant specializing in mortgages from the company "Mishkanta 365" reveals that in some cases consolidating loans is the worst step you will choose to take (Weshow company)
Most small and large businesses alike have at some point sought financial assistance to grow the business.
Although there is nothing wrong with this, some are enough to accumulate quite a bit of debt from the loans, which negatively affects their cash flow.
Business owners who wish to ventilate the flow can consolidate these loans and produce lower payments.
Sounds great, doesn't it?
Hila Seyda, CEO of Mortgage 365, who has a bachelor's degree in business administration and specialization in accounting and holds an accountant's license clarifies, not everything is black and white. Hila: "Loan consolidation is not suitable for everyone, and for some businesses this can be a bad decision, especially When it comes to the self-employed who don't know how much they earn."
Hila Seyda, an accountant specializing in mortgages from the company "Mishneta 365" (Photo: Keren Rafali)
Who might fall into the trap?
Hila: "When it comes to the self-employed, most of them do not know how much they earn every month. Many business owners get the feeling that the business is working wonderfully. On the surface, everything looks wonderful - there are sales, the customers are satisfied, salaries are paid on time, but in reality, they do not know how much They really spend money. If they pay NIS 5,000 in rent and their loans are NIS 7,000 a month, they start with a deficit of NIS 12,000. The business may be making a good profit, but with such a starting point, most businesses will not be able to survive for long, especially when you consider culture The abundance and countless temptations that are offered to business owners in the guise of benefits and promotions."
The scenario you describe is the ideal scenario for consolidating loans and taking out a mortgage for any purpose.
So where is the problem?
Hila: "The problem is not in the solution, but in poor consumer and financial behavior. It starts with our patterns, and this is relevant to the self-employed and employees alike. Without financial understanding and financial education, the writing is written on the wall - it's a snowball that won't stop, so loan consolidation will only serve as a Band-Aid, and will not provide a solution Good enough for the long term."
Assuming that the borrower changes his consumption habits and conducts himself financially correctly, would consolidating loans be a wise move?
Hila: "This is the condition for success, and without it it is better not to take such a significant step. Consolidating loans has many advantages - maintaining a low monthly payment, organizing the loans and dealing with one creditor are the main ones. However, it is important to remember that it extends the spread of payments and not Solves the financial problems in their essence, but rather gives room for action to start taking financial responsibility and conduct yourself wisely from a consumer point of view."
How important is financial education?
Hila: "Knowledge is power, and financial education is the key to economic success, especially in the modern era. Lack of financial literacy can affect every area of a person's life, and even more so when it comes to managing his business. Without it, he will not be able to cover emergency expenses, at best. In case The worst thing is, he won't have resources for current expenses either, and before the end of the month the money will also run out. That way you can't save, and certainly not invest or think about steps for the future, which may also affect a person's general sense of security."
And to whom would you recommend considering consolidating loans and taking out a mortgage for any purpose?
Hila: "Business owners who are willing to commit to a process of economic growth, to learning proper economic behavior and acquiring financial knowledge can consider this possibility as a positive step for them. It is important to emphasize that consolidating loans can be a lifeline, but if there is no change in consumption habits and financial conduct, very quickly The borrower's condition will deteriorate,
Mortgage 365 is a company that specializes in mortgage consulting, free from banking considerations, committed to the client's interest.
The company works with all the banks in Israel and undertakes to give each customer the most optimal conditions for him while finding the right financial solutions for him.
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