What if a debtor turns mad?
In today’s day and age, financial issues are bringing out the worst in people. While most find a way to deal with their current issues, some go off the deep end – and never return to a normal lifestyle.
This brings up a very important question: would a debtor be obliged to pay off his debts should he go insane? As you can imagine, this is not something you would want to experiment with. Undoubtedly, you are much better staying sane, working towards paying your debt down, and eventually getting back on stable ground.
Unfortunately, you are obligated to pay back your debt regardless of your mental state. However, there are a variety of details that can and will change your situation including how your debt is paid back and the process that is followed by lenders.
Is there a cosigner on the account? If so, this person will be responsible for paying the money if the primary debtor turns mad or is unable to pay for any reason. This is why you must be extremely careful when cosigning on any type of loan. In fact, unless it is your immediate family it is best to decline an offer to co-sign.
It goes without saying that somebody in a mental home is not going to have access to bills, payments, and other financial information. In turn, they cannot be expected to handle debts and all of the payments that go along with them. Instead, somebody close to this person, such as a spouse, will have to assume the responsibility.
Those who don’t have a spouse, family member or close friend to handle their affairs will find things getting worse as they try to get their life back on track. While getting help, your mortgage payments, for example, may begin to back up. Despite your situation, your mortgage lender has no choice but to foreclose on your property.
A debtor who has somebody managing their bills is in much better position. This person, if trustworthy, can explain your situation to lenders and work out a deal to ensure the best possible end result.
Generally speaking, a debtor is obliged to pay off his debts regardless of the situation. The process in which the debts are paid depends on many details, including the type of debt as well as whether or not there is somebody who can help manage the process.
Are economic times tough? Most definitely. Although you may feel down and out and on the brink of insanity, keep your composure and continue to pay down your debts a little bit at a time. Even if you have to negotiate better terms with a lender, it is better than running away and hoping for the best.