Indebtedness

Indebtedness describes the extent and volume with which a natural or legal person has borrowed money from others. In contrast to over-indebtedness, one speaks of indebtedness when several credit claims come together in an amount that cannot be settled through the monthly salary, but are covered by valuables and assets.

An example of this is a mortgage loan. Although the total loan amount exceeds the monthly income, it is paid off through the monthly instalment. If necessary, the loan can be serviced with the value of the home.