Any amount of money that a person owes to a business or another person is called debt. Most people cannot avoid accruing debt at some point in their lives. Even simple tasks, like grocery shopping or buying gas for one’s car, allows people to owe money to others. How a person handles his or her debt, however, influences his or her abilty to buy other goods and services. People who want to buy a house must often apply for some sort of financing. Their application for a mortgage reveals their ability to repay debt on time and in full. Debt does not have to be a bad thing in a person’s life. In fact, many people find that debts are necessary to help them purchase services and goods that are necessary for their everyday lives. Car loans, mortgages, credit card bills, and other obligations are common parts of adults’ lives.
