Advice On Debt & Credit Advice

Debt is fast becoming a problem in the United Kingdom – if not the world and with an average household debt standing at nearly £55,000, we’re sure you can see why.

Debt is a very sensitive subject – let’s face it, no one likes to talk about the subject, especially if you are experiencing financial problems yourself. The thing is, you’re not alone. The total UK debt stands at about £1.3 trillion and is due to gradually rise in 2012 and 2013 – and in fact for the foreseeable future.

So why does personal debt keep growing in the United Kingdom? Well, there is no one reason, but a certainty is that creditors keep on lending – even when your credit score is below par. Pay day loans are one example. A payday loan can be a good thing, as long as it is managed properly. Payday loans are exactly as the name suggests, a loan until you get paid by your employer. These types of loans usually carry extremely high rates of interest and can also charge initial fees. The high rate of interest can make the loan especially difficult to repay if left unattended past the loan repayment period. Always make sure you borrow from payday loan companies responsibly, or things can get out of control before you know it.

Other credit debts that have been incredibly popular over the past couple of decades is credit cards. Most people carry at least one credit card in their wallet or purse these days and is a preferred method of offsetting a payment until you get paid – especially if your credit card offers some kind of cash back incentive. However, if your circumstances change very suddenly, a credit card can go from being your best friend, to your worst. Late payment charges and interest will soon see your balance take off and if your balance exceeds its credit limit, further charges may be incurred.

Loans and various forms of credit are everywhere these days – you only have to open a newspaper, or turn on the TV and a creditor will be trying to sell you their services. A good looking woman, a happy family or someone running through a field will normally be featured, making the process look very attractive and risk free. The trouble is, it’s not. Governing bodies are trying desperately to get creditors to give consumers as much information as possible about these types of products, which of course is a great start. Consumers should also take some responsibility though – make sure terms and conditions are read and questions are asked, or you could find yourself with a nasty red letter in the post asking for more money than you intended to spend! If you are having trouble with credit, then try to find a company that will offer you free debt advice.