Most debt counselors say that it is a good idea to talk to the people to whom you owe money. If you ignore the problem it will only get worse. You may find that you are paying extra interest and your debts are just getting bigger every day. Many creditors try to be understanding and if you tell them why you are unable to pay, then they will sometimes be willing to reach a compromise.
Subject: Urgent Notification: Fixed Income and Financial Hardship in Puerto Rico Dear [Creditor's Name], I hope this letter finds you well. I am writing to you as a representative of Puerto Rico, with an important update regarding our financial situation and the challenges we currently face. Introduction: Puerto Rico, an unincorporated territory of the United States, is known for its vibrant culture, beautiful landscapes, and resilient people. However, our island has been grappling with a severe economic crisis for several years. This has resulted in fixed income constraints and exacerbated our financial hardship, which we feel obliged to inform you about. Types of Letters to Creditors Informing Them of Fixed Income and Financial Hardship: 1. Institutional — Government Debt: The primary focus of this communication is to address the financial predicament of the government of Puerto Rico, seeking understanding and cooperation from creditors. We recognize the value of our debt obligations but currently lack sufficient resources to fulfill our financial commitments as originally agreed upon. 2. Private — Individual/Family Debt: Apart from the government's obligations, many individuals and families on the island are facing their own financial struggles due to fixed income and limited financial resources. These letters may be sent by ordinary citizens to their creditors, explaining their hardship, and seeking possible assistance or debt restructure options. Content: a) Explanation of Puerto Rico's Financial Crisis: Puerto Rico has experienced an ongoing economic downturn, characterized by high levels of debt and a significant decline in revenue generation. This has been compounded by multiple factors such as natural disasters, population decline, and an aging infrastructure, making it increasingly challenging for us to meet our financial obligations. b) Fixed Income Constraints Impacting Debt Repayment: We want to emphasize that due to restricted income streams and a lack of access to traditional sources of credit, we are unable to meet our debt obligations within the current framework. These fixed income constraints have forced Puerto Rico to seek alternative solutions to address our financial hardship. c) Commitment to Resolving the Situation: Despite the hardships we face, Puerto Rico remains committed to working towards a sustainable solution in collaboration with our creditors. We acknowledge the importance of fulfilling our debts or seeking mutually beneficial agreements to mitigate the impact on both parties involved. d) Appeal for Cooperation and Understanding: We humbly request your understanding and cooperation in acknowledging the unique challenges we currently face. We seek your support in exploring potential debt restructuring options, alternative payment plans, or any other arrangements that can ease the financial burden while maintaining a sense of fairness. Conclusion: In conclusion, we aim to maintain an open line of communication to address the fixed income and financial hardship faced by Puerto Rico. By collectively seeking innovative solutions, we can work towards a more stable economic future. We hope to engage in constructive discussions and find mutually beneficial resolutions that take into account the best interests of both parties. Thank you for your attention to this matter. We appreciate your understanding and fervently hope for a positive response. Sincerely, [Your Name] [Contact Information]
