Delinquent debt is by far the most common financial concern. In adjudicating these cases the following factors are taken into consideration:
• Cause of debt
• Response to debt
• Amount of debt
Cause of debt is generally more important than the amount of debt, because it reveals more about a person’s reliability, trustworthiness, and judgment. Of people who seek credit counseling, roughly 50 percent are due to irresponsibility. If the debt was caused by irresponsibility (including reckless behavior) that is likely to continue, the problem is magnified. If the debt occurred due to situations beyond the applicant’s control and the applicant is handling the debt in a reasonable manner (including bankruptcy or debt consolidation), the significance of the problem is substantially reduced.
Response to debt is evaluated by the things people do (or don’t do) about delinquent debt. How people deal with debt is often a decisive consideration. Those who ignore their financial responsibilities may also ignore their responsibility to safeguard classified information. Classic indicators of irresponsibility and unethical behavior are:
• Changing addresses without notifying creditors
• Failure to take reasonable measures to pay or reduce debts
• Knowingly issuing bad checks
• Increased credit card use immediately before filing for bankruptcy
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