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Secured loans can help restructure debts simply, quickly and responsibly. How can you best manage debt?
According to recent figures, the British owe over a trillion pounds on loans, mortgages and credit cards. The BBC reported that this equals an astonishing £17,000 of debt for every person in Britain. So how do we manage that debt? A Bank of England report has revealed a growing trend – families are increasingly consolidating their debts by taking out secured loans
How to avoid debt
Clearly, avoiding debt is the best option in the first place but it isn’t always easy.
There are basic guidelines you should follow to avoid debt:
- Don’t overspend
- If you can’t trust yourself with credit cards, don’t use them
- If you do use credit cards, shop around for one with a low interest rate
- Avoid store cards – if you don’t pay them off within the interest-free period - their rates are far higher than most credit cards
Don’t ignore the problem
So you’ve spent too much and that debt just won’t fix itself. Thrusting your head into the sand won’t help and you should take action before things escalate further. It can be a very stressful situation to be in, and you should always seek advice if you feel overwhelmed by debt.
Prioritising can help:
- Prioritise essential costs such as your mortgage and utility bills
- Pay off your credit cards or store cards with the highest interest first
- Switch to a lower rate of interest on your credit card
- Seek financial advice
Loans
However, not everybody is in the fortunate situation of avoiding debt, and many of us are already in financial difficulties. So what options are available?
Secured Loans
Loans offer a ‘quick fix’ solution to consolidating debt. You should however shop around for the lowest interest rate available. You also need to ensure you can manage to upkeep repayments as secured loans use the value of your house as security.
Unsecured loads
You do not have to be a home owner for an unsecured loan but you do need to be aware that if you fail to keep up your repayments you will end up with bad credit rating and could be refused credit cards and even a mortgage as a result.
What about saving?
If you are already in debt than it is a good idea to concentrate on paying that off before you think about saving money. Being in debt costs more because of the interest rates you will be paying on your debts.
Loansum is a specialist broker that searches the market to find a low rate secured loan that’s right for you. Call us on Freephone: 0800 848 8046 to find out how we can help you or email help@loansum.co.uk.
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