Tag Archives: debt

UK Workforce Turning To Payday Loans, According to Unite

UK Workforce Turning To Payday Loans, According to UniteAccording to research undertaken by Unite increasing numbers of workers are turning to payday loans since their wages run out before month-end.

According to the report London-based workers are thought to borrow the large majority of payday loans for housing.

The report suggested that two fifths of workers who take out these short term loans use the money for a variety of things – including rent / mortgage, food and utility bills.

This raises concerns that if consumers are unable to meet the cost of living through wages it’s unlikely that they will be able to repay the payday loan effectively.

It should be noted that the ridiculously high APR attached to payday loans is not an accurate measurement of the interest repaid as it’s over a yearly period. However, whilst this may be the case it’s also worth bearing in mind that, if constantly deferred over a number of months, the levels of interest mounts up – leading to spiralling debt problems.

Whilst payday loans are clearly useful if you need a quick solution to help pay emergency bills they should only be used as a last resort or if you’re absolutely sure that you can meet repayments on your next payday. Otherwise it may be worth simply calling the company you owe money to to arrange a repayment plan. Whilst this may not appeal it is a safer way of controlling your debt than turning to a short term solution.

If you do need a quick solution then compare payday loans with Creditwindow.

Applying For Credit – A Few Tips

Applying For Credit - A Few Tips

Applying for credit isn't always what its cracked up to be. For many people with a poor credit history it's certainly not that simple.

With the British economy in the dire state it’s in many people are struggling to meet monthly payments. Unfortunately this can have severe consequences on personal debt as well as on the customer’s credit score.

Council tax bills and credit cards tend to be the most commonly missed payments – which will hardly come as a surprise to many. However, the likes of payday loan repayments are probably not too far down the list either.

So what can you do to ensure that your credit score is in tip top condition for the year ahead? Check out these top tips:

Pay off existing debt.

If you are looking at applying for a credit card, payday loan or other form of credit then it’s really important that you make sure you have repaid any existing debt you may have. Whether this is in the form of unpaid council tax bills, outstanding credit card balances or utility bills – it’s important to make sure your credit history has a clean bill of health.

Sign up to the Electoral Roll.

This might sound odd but did you know that signing up to the Electoral Roll is one of the best ways of improving your credit schore? A number of credit referencing companies actually check against the Electoral Roll to help fight identity fraud. This is why it’s essential that you make sure you’re signed-up to it.

Check what the credit reference firms have on file about you.

We see these adverts almost daily – especially since many of us spend so much time on the internet. However, it’s important to consider signing up to the likes of Equifax or Experian to keep a close check on your credit score. This not only gives you information on your credit history but it will also flag up any repayments you may have missed. It can also help to keep track of potentially fraudulent activity on any of your personal accounts – allowing you to remedy any issues that may arise relatively quickly.

Do you have a credit history?

If you are lacking a credit history then it can be difficult to obtain any form of credit… sound strange? Well it probably is, however, lenders are less likely to trust customers who have no history of borrowing money. This is largely because lending firms are unable to see how you behaved previously when it comes to repaying debt – as a result they will be unable to predict how you are likely to behave when it comes to repaying the loan they extend to you. This sounds incredibly unfair but there are loan and credit card companies out there who will lend – however you may be restricted to a low balance and you may start off paying a higher rate of interest to begin with. In spite of this it is worth considering as this will improve over time and as a result you will improve your credit history as a result.

Mortgage Holders Turn To Payday Loans

Mortgage Holders Turn To Payday Loans

Mortgage holders and tenants are turning to payday loans, credit cards and short term loans to help meet the monthly costs.

A survey by homeless charity Shelter has revealed that almost 1 million mortgage holders took out payday loans to help meet mortgage repayments last year.

The survey went on to reveal that a whopping 7 million people in total were dependent on some form of short term loan, credit card or unauthorised overdrafts to help meet the costs of their mortgage or rent.

Shelter have suggested that by turning to the likes of payday loans or credit cards could well see more and more people spiralling into debt.

The Charity’s CEO, Campbell Robb, commented:

“Every two minutes someone in Britain faces the nightmare of losing their home. We urge every single one of these people now relying on credit to urgently seek advice.”

Creditwindow suggests turning to the likes of the Consumer Credit Counselling Service or Money Advice Service to seek advice on managing debt and to look into new ways of controlling spending to meet monthly needs.

If you are looking for a debt management programme it may be worth looking at what the likes of MoneyExpert have to offer.

Image: Idea go / FreeDigitalPhotos.net

Managing Debt Effectively – Its Easier Than You Think

Managing Debt Effectively - Its Easier Than You Think

Managing Debt Effectively - Its Easier Than You Think

If you have mounting debt in the form of credit cards, personal loans, backed-up mortgage repayments, etc, then it can be a really daunting task when it comes to paying it all off!

So what can you do to help make managing your debt easier? That’s a good question and it’s not always the easiest one to answer – usually people opt to approach a debt management service, however, it’s important to consider all your options first.

What This Article Is

This article is a resource to find out how you can get your personal debt under control, offering free and impartial advice.

What This Article Is Not

This article, although will offer recommended firms to help manage debt, is not solely focused on this. It should be made very clear from the start that debt management programmes can benefit some people but is certainly not appropriate for everyone.

Don’t Ignore Your Debt

1. Try To Meet At Least The Minimum Repayments

2. Debt Counselling – some charities offer free debt counselling to people and they can give excellent advice. Try talking to the Consumer Credit Counselling Service.

3. Increase Your Income – whether that means getting an additional job, finding a new one or even asking for a pay-rise.

4. Consider switching utilities providers (gas/electricity) – shop around and see what’s out there!

5. Remortgage Your Home Or Trade It In For Something More Affordable.

6. With the ever growing price of fuel you could consider downsizing your car to a more economical model.

7. Stop gathering new debt – cut up those credit cards and stop taking out loans!

8. Cut out those vices – consider giving up cigarettes, alcohol or whatever (on average a pack of 20 cigarettes costs £5 – £6 a time – think about how much you could actually save in the longer-term!)

9. Prioritise your debt payment – get the most urgent debt paid off first.

10. If all else fails you could consider a debt consolidation plan where you consolidate all your existing loans, credit card debt, etc, into one, easy to pay, lump sum.

What Is Debt Consolidation?

Debt Management or “consolidation” is simply a method of putting all your existing debt (i.e. credit card, loan, mortgage, debt) into one lump sum.

In effect a debt management company will arrange a repayment plan where you pay everything off over a period of time. Usually you will find that the debt firm offers a good rate of interest (APR – Annual Percentage Rate) that will help keep repayment costs reasonably low – as long as you keep paying it on a regular basis.

As long as you avoid getting into more debt (cut up those credit cards or at least hide them away!) you should have your debt paid off reasonably quickly.

However, whether you take a debt management plan or not, it’s certainly worth following the ten points mentioned previously as this will help cut spending and help you live within your means.

Find a debt management plan to suit you

Payday Loans On The Cards For Millions Of Brits

Payday Loans On The Cards For Millions Of Brits

Insolvency experts are expecting to see an increase in British consumers taking out payday loans over the next six months or so.

With the impact of high inflation, low income and high unemployment, many British consumers are expected to turn to payday loans to last them until payday, insolvency experts have claimed.

Insolvency experts, R3 have reported that they expect the number of people taking out payday loans to increase based on the responses of 2,000 people.

The survey by R3 showed that 60% surveyed were concerned about their level of debt and, probably more worryingly, 45% struggled to make their money last until payday. This actually increased to 62% for 24 – 44 year olds.

The £2 billion-a-year payday loan industry is thought to be a cheaper alternative to than going overdrawn or facing a credit card charge, hence why they are becoming more popular than ever.

However, consumers are urged to ensure they re-pay the short term loans back as quickly as possible, otherwise they could end up facing more expensive roll-over, monthly charges – known as deferrals in the industry.

With the increasing number of people turning to payday loans, otherwise known as payday advances, both politicians and insolvency practicioners are becoming increasing concerned about the number of people falling into debt. As a result they have called for a standardised industry code of practice to be introduced to help ensure that customers are treated fairly.

In spite of this the majority of authorised payday lenders, such as Wonga.com, PaydayUK and QuickQuid, are members of the consumer finance organisation, an authority that strives to regulate payday loan firms and other financial organisations that are not necessarily controlled by the Financial Services Authority (FSA).

This writer has a feeling that 2012 will prove to be a very interesting year for payday loan firms, especially now tighter regulations are being called for from all sides…

The Slice

Credit cards – in this economy?!

Are credit cards really the best solution in an economy ravaged by debt? That’s a good question and while credit cards might not be suitable for everybody and in every instance there is still a place for them, even in this post-recession, fragile economic state the UK has found itself in.

What benefits are there to having a credit card?

Get stuck in and read our top reasons to own a credit card, other than to lend you money… you may be surprised in what you learn.

1. Credit cards, when used sensibly, can help to repair a damaged credit rating. Even if you get a high-interest credit card, when used in moderation and, as long as you pay off debts monthly, you could see your credit rating sky-rocket!

2. Using balance transfers to pay off other debts could benefit you as, usually, it proves cheaper to pay off debt on a credit card as interest rates tend to be lower.

3. Use credit cards to help spread the costs – especially if you need to buy expensive goods or services but can’t pay-off in one go.

4. Earn cashback with credit cards, as long as you pay off credit card debts on a monthly basis.

5. Get exclusive discounts on certain goods or services with a credit card – many cards offer this service and certainly worth shopping around for to make sure you get the best credit card to suit you.

Whilst all of these are valid reasons to own a credit card Creditwindow understands that not everyone has a great credit score and it can prove difficult to obtain the one you want. As a result we have included a great list of both premium rate and poor credit score cards – check them out and find a credit card to suit your needs.

Help in Handling your Money

Experiencing problems managing your finances, take a look at this comprehensive list of agencies that could help you help yourself:

Debt Management
For help in consolidating debt please visit our debt management page.

Citizen’s Advice Bureau (CAB)
Debt agencies and lenders chasing you for loan and credit card repayments and feeling over-whelmed? Why not speak to the CAB, an organisation setup to give consumers free, impartial advice.

Consumer Credit Counselling Service (CCCS)
For anyone faced with growing credit card and loan debt, the CCCS offers free and confidential advice and support service, online or over the phone.

National Debtline
This service also offers free independent and confidential advice over the phone for people living all over England, Wales and Scotland. Call: 080 88 08 40 00. Alternatively, visit the National Debtline website.

Credit Action
The Credit Action organisation are a finance charity that’s dedicated to improving British people’s thinking about money. They offer a number of resources, tools and training to help educate people better about handling personal money better.

Could A Payday Loan Make Or Break Your Credit Rating?

Could A Payday Loan Make Or Break Your Credit Rating?

Find out how a payday loan could help or hinder your credit score.

Did you know that a short term loan or payday loan could make or unmake your financial future? Well maybe not… but it could help.

It’s incredible when you think about it – did you know that a payday loan can actually benefit your credit score? Well… as long as you pay it back in time and don’t default on your payments.

Payday loans are useful if you need money quickly as you never really know when you might have a financial emergency and need cash fast.

The problem is – it’s not really your money, it’s the lender’s money and, like anything you are lent – you have to give it back. In the case of a loan – that’s paid back with interest. An important point but funnily enough it’s not something that’s touched upon by credit or loan companies enough.

I guess the real question you need to ask yourself before taking out a payday loan is – “can I pay it back?” If the answer is an unquestionable “yes” – then great, however, if it’s a maybe or a flat no then my advice is – really don’t risk it. the likelihood is you’ll just end up getting in debt and harming your credit rating even more than it already is.

If you harm your credit score you will only end up harming your chances of taking out a mortgage (if you want to buy a house) or getting credit for that car you want or, in some instances simply paying for your shopping with that credit card when you’re low on funds.

This author recommends that you sit down and have a long hard think before you make a decision on whether you should consider a short-term loan or not. You have to decide whether the risk is worth it or not – the lender can’t give you that advice.

Payday Loans Thought To Be The Main Reason Behind Low Income Debt

Payday Loans Thought To Be The Main Reason Behind Low Income Debt

Payday loans and short term loans are thought to be the main reason behind low income consumers being faced with spiralling debt problems.

Debt experts are suggesting that payday loans are the primary cause for lower income consumers facing mounting debts.

Due to the inflexibility of some mainstream lenders, most notably banks as a result of the UK economic recession, people on low incomes are having to turn to payday loans to help ease “their financial burdens.”

In many cases short term loans such as payday loans and doorstep loans can help to illeviate the financial pressure on British people. However, those on low incomes are urged to be cautious when opting for a quick, short term solution to brige the gap until payday.

One debt expert commented:

“If the problem is unsecured debt that has become unmanageable then it’s important that people who are struggling to meet their repayments seek help.”

He added that people on low incomes should look into what state benefits they could be entitled to, it could mean the difference between mounting debt and the ability to face those monthly costs until payday.

Should payday loan debt get out of control consumers are urged to consider debt management plans to help ease the debt by consolidating the debt so the consumer repays the amount in easy, manageable chunks.

Free money services such as the Money Advisory Service and the Consumer Credit Counselling Service may be worth talking to if you’re after help in controlling personal debt.

Creditwindow urge any consumers to be careful when seeking credit cards, personal loans or any type of financial borrowing. Anyone looking for a loan or credit card should do some thorough research before applying for them. Creditwindow boasts a number of guides, news and features that deliver impartial advice on financial lending.

To find out more please feel free to check out any of the main categories on this site, it’s worth knowing what your options are and the differences between the loans and credit cards.

IVA Advice Options Explained

IVA Advice Options Explained

Guest Blogger, Simon Wyllie, explains IVA advice options for consumers struggling with debt.

After a short period of decline, it’s apparent that adults throughout the UK are once again building up their personal debts. A few years ago this was often to fund luxuries such as new cars or foreign holidays. During the current economic squeeze the evidence is that many adults are using credit just to survive financially, with debt often being used to finance essentials such as a mortgage, rent or food.

Inevitably a growing level of debt will leave some people in a position where the repayments become unaffordable. This often occurs due to an unexpected change in circumstances and separation, redundancy or another form of income loss may be the root of the problem.

For residents of England, Wales and Northern Ireland an IVA (Individual Voluntary Arrangement) is one of the options to bring uncontrollable debt repayments back under control. Choosing where to obtain IVA advice is however not always easy.

For good reasons many people like to approach trusted organisations such as the Citizens Advice Bureau when they get into financial difficulty. The advisers at the CAB may well be able to provide good IVA advice as well as to direct people towards other viable options. However it should be remembered that the CAB isn’t itself a provider of IVA service so may not be able to provide full detail on the intricacies of an IVA.

IVA advice is also on offer from most Insolvency Practitioners. An Insolvency Practitioner is the individual that actually takes a “personal appointment” to handle an IVA for someone who wishes go ahead. It’s suggested that anyone seeking IVA advice focuses their search on Insolvency Practitioners that specialise in personal IVA services as opposed to the other main area of insolvency work which is “business recovery”.

Many IVA intermediaries also exist and are often connected to websites that appear to be direct providers of IVA services. They will eventually sell your “case” to an Insolvency Practitioner who will deliver the actual service. It’s strongly suggested that nobody should pay any kind of an upfront fee to any of these IVA intermediaries.

As IVA advice is a very technical area, rooted in insolvency law, many people have a lot of questions that they’d like answered

before proceeding with an IVA. In such circumstances an IVA forum may be useful. An IVA forum allows information to be gleaned from IVA experts as well as the exchange of personal experience between people dealing with similar debt situations.

Guest Blogger:

Simon Wyllie

IVAAdviceForum.co.uk

Get yourself help with Creditwindow's debt management programmes.