Credit and loans
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BORROWING MONEY
Most of us need to borrow money at some point in our lives, and it's not necessarily a bad thing. Using the right type of credit in the best way can help you deal with unexpected expenditure, such as if you need to buy a new fridge or washing machine. But there are things you need to think about to make sure you’re making the right decision.
Before you borrow money, make sure you can afford the monthly repayments on top of your current outgoings. Knowing exactly what money is coming in and going out each month will help you work out whether you can afford to borrow.
If you want to borrow money and pay back a fixed amount every month, a personal loan is one option. Make sure you understand your decision and commitments before taking one out.
It is important to know the difference between secured and unsecured loans when you are borrowing money. Find out more here.
CREDIT CARDS
Used well, a credit card is a secure and flexible way to pay and can be a good way to spread the cost of major purchases. But if you only make minimum payments or run up a bill you can’t pay back, credit cards can be costly and can lead to a spiral of debt. Learn more about this here.
Using a credit card for your spending can have many benefits, from added legal protection to earning cashback at your favourite retailer. But if you don’t pay your card off in full each month, credit card debt can quickly mount up. Find out more here.
Use this online credit card calculator to quickly find out if you are in control of your monthly payments.
STAYING SAFE
Loan sharks are illegal lenders who often target people who need to borrow money and can’t access it from legal sources. They might seem friendly at first but borrowing from them is never a good idea – even if you feel you have no other options. Find out how to protect yourself here.
Stop Loan Sharks investigates and prosecutes illegal money lenders and provides support for borrowers in the UK. Visit their site for more information or to start a live chat, or you can call 0300 555 2222 to speak to someone.
CREDIT LIMITS AND CREDIT SCORES
Building a good credit score is important because it can affect your ability to borrow money or access products such as credit cards or loans. You can check your score for free and if it isn’t in the best shape, there are things you can do to improve it.
Have you ever wondered how a bank or other lender decides whether to give you credit? One of the tools they use is your credit report. This tells them about your credit history and helps them assess how much of a risk lending to you will be, depending on the quality of your credit score. Find out more here.
If you have a credit card or overdraft but want to increase your credit limit, how can you go about it? Find out what you can do to increase your limit and, more importantly, whether you should.