It is a common practice nowadays that we spend money in advance: we take it from banks, we get all the goods we need now and pay for them over the next 10-20 years or even more. This is understandable, nobody wants to live with their parents until they can buy themselves a home. Taking a loan is the first thing which comes into our mind whenever we need more cash to satisfy our present needs.
Unfortunately, many people don’t plan their financial future and they take personal loans which they cannot pay back afterwards, or they take secured loans and find themselves in the unpleasant situation of seeing their goods sold to auctions, in order for the bank to get the money back.
Under these circumstances, I would say that the financial system has a big responsibility in granting loans too easily. Anyway, I think that banks aren’t happy when their clients don’t pay their debt, because the bank wants people to respect the loan contracts and to pay the interest, not to sell their homes at auctions, case in which the bank takes only the remaining amount of debt plus a penalty fee, but no interest.
So, both parties have the same interest. Too bad that human nature is sometimes too optimistic, and some people bite more than they can chew.
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