Having poor credit or bad credit will affect you financially; the low credit indicates to any lender that you are a high risk borrower. If you have a bad credit score this may have many obvious effects on your financial life. Sometimes you could be denied credit, and even if you are not denied it may be very expensive to get credit on any loans or cash advances.
Here are some measures that to be taken during bad credit so that you can get out of it very easily:
- Know your credit score: The first measure to be taken is find out your credit score, revise your credit report thoroughly so that you will be in a better position to know the ways to improve your credit rating. If you find any mistakes or identity theft in your credit report make them rectified as early as you can. This will help you to understand your financial situation. Once you repair or improve your credit report you will be able to qualify for a better loan.
- Avoid late payments on any debts you owe: Pay them on time. If possible take a payday loan and pay your bills on time. Ensure other bills such as utility, electric, gas and water bills are also paid on time, as they affect your credit history.
- Credit card bills: If you have credit cards bills that have to be paid, clear them off at the end of each month regularly. Stop using your credit cards to buy small items since this can freeze up cash, use credit cards only for major purchases and use them wisely, preferably use low interest credit cards.
- Avoid unnecessary expenses: Prepare a list of necessary goods and bills for each month. Divide your income to pay them first. Plan your budget well and take some steps to make extra income by part time jobs or rotating your money instead of saving. Though it takes some time to repair your credit, planning well and implementing, it will enable you to get out of bad credit very quick.
- Manage your bad credit debt: There are many financial institutions on the market that provides various options to deal with debts, like by providing debt consolidation. They help to manage your debts efficiently. They will negotiate with lenders to minimise interest rates. This allows the user to save some money; the debt consolidator provides a suitable plan to the debtor so that they can enjoy their financial freedom.
About the Author:
The guest post was contributed by Alicia, financial guest blogger from Manchester, UK. Find out more about her finance related blogs at financeport
There are three main credit reference agencies in the UK. Experian, Equifax and Callcredit are used by lenders wishing to assess an individual’s creditworthiness. Information from one or more of these agencies is used before granting credit, in addition to personal details from the application form. If you want to improve your chances of obtaining a loan or credit card, it is advisable to check your credit file every few months.
Your credit file is a reflection of your previous and current use of credit and it needs to be carefully monitored for accuracy. There are many helpful tools MoneySupermarket.com which allow consumers to research how to improve their credit rating. There are various reasons why checking your credit file regularly is important.
Errors can sometimes appear on a credit file which can have an adverse effect on the credit score if left unaddressed. It is advisable to make contact with the credit reference agency and inform them of the mistake. They will mark the entry as disputed and investigate as appropriate. It is very important that they add a note to your credit file regarding the disputed information before you apply for a new credit card or loan. Any lender looking at the credit file will then see that certain information is in dispute and may make allowances for that.
Checking your credit file for suspicious activity will reduce the risk of identity theft. Fraudsters can use your personal information to obtain credit cards and loans and open bank accounts, so scrutinising your credit file every two or three months to see which financial institutions have requested information will help to combat this. If any suspicious activity appears on the credit file, seek expert advice immediately.
Lower Interest Rates
People who have a low credit score may be charged higher interest rates on loans and overdrafts. Credit providers look favourably on consumers who have built up a healthy credit history by making repayments in full and on time and they tailor their interest-rate offers accordingly. By checking your credit file regularly, you can see how previous borrowing is affecting your current chances of obtaining credit. It may be worthwhile to close unused credit card and bank accounts as lenders sometimes look at the total amount of credit available to you, rather than how much has actually been used. You may find that you are offered better interest rates on future loans as a result.
Keeping an eye on your credit file is important for your financial future. By checking the entries every two or three months you stand a better chance of obtaining credit.
The recession and subsequent tough economic times have affected everyone in one way or another. With a number of large companies making cuts many have found themselves with less working hours, cut salaries or even jobless. With the cost of living rising- the pressure on household budgets has gone through the roof.
Because of this many have been forced to reassess their finances; cutting down on social spending and prioritising bills. This has meant that unexpected emergencies such as broken down cars or household appliances may break the budget leaving some bills unpaid.
Missed payments on bills such as utilities or current loan repayments can lead to defaults which will be reported to credit reference agencies, damaging your chances of being approved for finance in the future. Having missed payments, defaults or even court orders on your credit record will deem you as having ‘bad credit history’, therefore being viewed as a high risk to perspective lenders.
Having a bad credit history is likely to make you ineligible for a loan via traditional methods such as high street banks or supermarkets. The recent rise in popularity of subprime lenders has meant that there are now a number of options available to those who have been declined by these mainstream lenders. Here is an overview of the types of ‘bad credit loans’ available:
Lenders offering this type of product will be able to offer between £1000 and £5000 over a term of 1 to 5 year. These are able to offer loans to those with bad credit as they will require a guarantor to support the application and guarantee to pay the monthly repayments should the borrower fail to do so. The guarantor must be a homeowner who is in receipt of a regular income (whether that’s in the form of a salary or selected benefits) and they must have good credit history. Guarantor loans are not secured against the guarantor’s property or any other assets. The interest rates of guarantor loans are higher than the equivalent loan via a high street bank.
Sometimes referred to as V5 loans and are secured against the borrower’s car, the interest of these are somewhat higher than guarantor loans due to the absence of the guarantor. The amount offered by logbook lenders will be dependent upon the value of the vehicle they are placing as security, with most lenders offering up to 50% of this value. The vehicle must be owned outright and cannot be leaser or owned on a higher purchase. The lender will not keep the car during the loan term and will instead hold the logbook; the applicant can continue to drive the car throughout the term of the loan, once the loan has been completely repaid the borrower receives their logbook back. Logbook lenders will carry out the initial application online and will be able offer a very quick decision, a consultation will then be held at a local walk-in centre which will finalise the loan agreement.
First introduced in America but now ever growing in popularity in the UK. Payday lenders offer small amounts of cash (generally ranging between £20 and £500) over a matter of days/ weeks or until the borrowers next payday. Payday loans have received a lot of bad press recently because of their high rates of APR; on the face of things, these will appear very high however this is not a true representation of the loan repayments as the loan is designed to be repaid in full. It is only when the borrower allows the payments to roll over that the interest will come into play and the repayment amount can become unaffordable. Payday loans are now readily available from a number of lenders and are often seen advertised on TV.
As you can see, for those in need of a bad credit loans there are now a number of options available. The most suitable loan for you will be dependent on; how much you require, the term you require the loan over and the repayment agreement e.g. would you prefer to pay the loan in full or in monthly repayments?
While the British economy continues to fight what seems to be an ever-lasting recession, the need for this type of loan will continue to grow; please note high street banks will be able to offer loans at the most reasonable rates.
Bio: Jason is a finance expert who writes for a number of top finance websites. Namely a website called http://www.badcreditloansnobrokers.co.uk that offers bad credit loans with no fees. His articles endeavour to help for readers save money and increase their chances of success when applying for loans.
Incurring financial crises is a common problem that will be faced by everyone with a limited income. The economic imbalance prevailing in the present market makes it difficult for someone who barely survives on a daily wage. There could come a time where you face an emergency requirement for cash that cannot you cannot afford; it is then that you wander all over in search of money. There are many ways you can lend money depending upon your circumstances & conditions. The place where you find the real difficulty in taking a loan is when they require a credit check, debt history and the all necessary legal issues based on your account balance.
If you do not have a good credit score then you are not considered eligible for a traditional loan. Even if you want to approach other financial institutions such as a pawn broker or a title loan you need to have an asset that acts as collateral. Unless you produce it the loan will not be sanctioned by the lenders. Such a situation will leave you with no options and make you feel really hopeless. There is no need to worry as you have the best choice available to you; that is a payday loan. These payday loans will provide you with the necessary support that keeps you strong in an unpredictable situation. They offer you with enough benefits to help you in solving your problems to some extent and give some mental support in facing these pending issues.
You just need to satisfy some of the simple requirements in order to avail the loan. The eligibility criterion requires the following:
- You should be 18 years old or over
- You should possess an active current bank account
- You should be a salaried employee at least for six months
Payday loan Benefits:
There are many advantages in securing a payday loan. The application process is really simple and completely online, which makes it really easy in applying for the loan within few minutes. This helps to support even a physically challenged person in securing the loan without any need for them to move from their home. Approval of the loan takes a few days which makes it really demanding, rather than going for a traditional loan that consumes a couple of weeks to months for approving a loan. The amount will be credited in to your account as soon as it is approved. You can utilise it as early as possible for any purpose as there is no need to specify the need for the loan.
Thus it could be the best option in an emergency where you are left with no alternative options. In fact you don’t need to go for any other options when you have the best one available at your reach.
About the Author:
My name is Michelle. I am a tech writer from UK. I am into Finance :). Catch me @financeport
Credits whether good or bad, play a vital role in your financial life. A bad credit is an indicator that an individual has a high credit risk. There are many factors that contribute to your credit score, and having bad credit spells trouble for any entrepreneur or businessman. It will cripple your financial stability, and anyone having a negative score will certainly have a hard time in obtaining loans.
What makes a bad credit?
There are certain behaviors that attribute to having bad credit. While a single entry will not make a dent in your credit score, a pattern of bad credit behaviors can accumulate. Eventually, the end result is getting bad credit.
There are also one-time big time entries that can have a huge impact on your credit score. Here are some of them:
Individuals having little to no credit history would most likely have a hard time getting hold of loans. So it’s not really a good idea having your credit history clean. If you do plan to use credit, do so sensibly.
Late or missed payments are another bad addition to your credit score. Most creditors will think twice of lending their money if they found out that you have a bad history in settling your dues. Word of advice: pay your bills and loans on time.
Too much outstanding debt is also a factor that can build up a negative credit score. Creditors will see you as an individual who bites more than you can chew.
Legal declaration of bankruptcy is one of the one-time big time entries that have a major impact on your credit score. This clearly shows that you can’t handle money well and is considered a big risk for creditors.
If the government is claiming your property for unpaid taxes, chances are you’ve just added a major entry in your credit score that will make creditors avoid you. Pay your taxes on time.
If a creditor charges off a debt that you owe, it’s not a good thing. Charge offs are big entries in your credit score. Just when you think you’re off the hook, eh?
Getting loans on a bad credit score
Having a bad credit score doesn’t necessarily mean the end of your financial life. Bad credit reports usually take 7 years (10 years if you file for bankruptcy) to be wiped off your slate. If you don’t want to wait for a decade or less to get another loan, there are still several ways you can borrow cash. There are a number of institutions that offer bad credit loans. You just have to do the legwork to find one that will grant your application.
Individuals with bad credit scores can still obtain loans if they have a guarantor. A guarantor is someone who ensures payment for an individual who is failing to pay his or her loans. Your guarantor can be a family member or a close friend. Just make sure they don’t have a bad credit rating like you do.
Putting up collateral is pledging something of value if ever you are unable to pay your loans. It’s worth a shot and might convince creditors to offer you a loan. There are many types of collaterals such as real estate, marketable securities, and other valuable physical assets like cars.
Credit unions are more eager to give you a loan even if you have a bad credit rating, provided that you are a member. They tend to not judge you with your credit rating. Credit unions may very well be the best thing you can borrow money from. The interest rates on loans are also lower than those of banks.
Loans to watch out for
You may seem desperate to find someone who would loan you money. But there are some lenders you need to watch out for. These individuals take advantage of your desperation for borrowing money and would offer you loans that accumulate over time. Some would charge you exorbitant rates, until you end up getting buried in a pit of debt.
Having a bad credit is not something to be embarrassed about. Creditors always deal with individuals who had bad credit ratings in the past. The last bit of advice would be to refrain from obtaining too many loans. Why do it again if it already gave you a bad credit rating in the first place?
About the Author: Johann is a Marketing Consultant for www.debtonsolidation.com.au, a debt
consolidation and agreement company. They provide assistance and advice for bad
credit loans and bankruptcy issues for people and their finances.
This week it was reported the amount of complaints to the financial ombudsman over mis-sold payment protection insurance (PPI) jumped to 30,301 between October and December 2011, this was 57% more than in previous three months according to the Financial Ombudsman. The figure takes up around a third of PPI complaints received last year alone. Over two-thirds of PPI cases were resolved in favour of the customer, this is down from 92% between July and September, the Ombudsman has said.
The Financial Ombudsman Service is predicting a big increase in the number of claims this year; Natalie Ceeney – Chief Ombudsman – states in their latest newsletter that up to 60% cases the Ombudsman will be dealing with will be for PPI: “The challenges of our PPI workload are unprecedented. The number of new complaints about mis-sold PPI that we are assuming we will receive in 2012/2013 – 165,000 – will account for around 60% of our new cases next year”.
What is PPI?
Payment protection insurance or PPI is an insurance policy designed to help people keep up with their loan or credit card repayments if they lose their jobs and cannot keep up repayments. However policies often do not cover things like pre-existing medical conditions and it was often sold to people who couldn’t use it and in some cases they didn’t even know they had purchased it in the first place!
What does this mean to you?
We at Bad Credit Blog think that if you have taken out a loan in the past ten years it is worth checking if you have been mis-sold PPI, as the stats suggest that you have a good chance at getting back money that was yours to begin with.
How do I make a claim?
There are two routes you can go down:
A. Contact your bank or lender; most banks have a PPI department to deal with these cases.
B. Using a third party to claim on your behalf; these are claims management companies that deal with your claim so you don’t have to although they will take a chunk of your money.
Whichever way you choose make sure you take back everything you are owed, the banks have set aside money for this and it’s yours for the taking. Good luck!
Bbbrr!! Winter has finally hit, and Christmas is yet again on its way. However research released by the Bank of England shows that this year through no fault of his own – or even Ebineezer Scrooge’s – poor Bob Cratchit has nearly £600 less to spend this year on Tiny Tim’s meagre Christmas.
Poor old Bob has been systematically squeezed from every direction – at least he doesn’t have to contend with the Plague like in Dickensian London – however he may have to eat Turkey Twizzlers on Christmas day – you can’t have everything!
Families this year have definitely been hit hardest – Bob was a bank clerk (wait for the irony!) so he wouldn’t have been hit so hard by all the job losses in the public sector – however what about VAT increases (we’d probably have to explain VAT in the first place!)
One thing that is important to note and is a massive plus in Bob’s favour is that he worked for a Banker – if he was alive today he’s probably be trousering a massive bonus – he probably would also have a fancy woman in a room over Mrs Miggins Pie shop that no one knew about!
There’s no doubt that times have changed – but one simple fact seems to cross between the time of Dickens and today – the rich get rich at the expense of the poor.
However, Charles Dickens was a massive fan of putting those who gained fortunes through foul mean s in their place – we can only ask – how long will it be until the final act?!
Hi readers, wanted to fire off a more personal money saving blog, to see if I can help to make anybody’s winter that little easier on the pocket.
Winter is here – how to keep the cold out
Basic science states that hot air rises and cold rides close to the ground, so the first thing anyone should do when insulating their house, is to make a note of all the cold vents in the house (doors, windows, gaps, keyholes, letterboxes, loft hatches, pipework leading outside and suspended flooring) and use insulation tape, draught excluder’s or old sheets to insulate all of these open gaps.
Once you’ve cold-proofed your house from top to bottom there are another few tips and tricks you can do to ensure you stay warm this winter.
Close off any unused rooms. The closed door makes that room another barrier between you and the wintry outdoors. It helps to stop the air from circulating, which in turn reduces heat loss.
Take a look at the video below for more great idea’s on how to keep your house warm this winter:
Should you be looking for further ways to insulate your house – there’s a big list of them here, although I apologise that some of them are a little far-fetched. Otherwise there are links to different products that you can order online (most will be ASDA links but you can find these products from any supermarket):
Jingle all the way! – How to keep you coiffers jingling in your pocket & have a Merry BadCreditBlogChristmas without becoming Scrooge!
Well it’s that time of year again – except for most of us this is going to be a unique Christmas. Austerity, tightness, being poor(!) whatever you want to call it for many of us this will be our first credit crunch Christmas – but follow some of these ideas and not only will they make it easier but more fun as well.
Christmas was made for family so club together – this has 2 advantages – first you get to see all the loved ones you’ve spent the year avoiding you’ve not been able to catch up with. Second of all you can all spread the cost. This means that very quickly you can have a Christmas to remember with lots of family members. Agree a price per head and a price limit on gifts. Everyone bring a bottle and before granddad is snoring on the sofa the day has been a hit!
If there are no kids involved then you could all agree to wait to get each other presents, not only will you get considerably more bang for your buck but you could turn boxing day into a day out into the boxing day sales..
Just where does it say in the bible you need to buy an expensive turkey? Well, there’s plenty of posh cheap tasty recipes out there, why not try and by some leftover turkey or a turkey joint and have a go at making a turkey and ham pie – extremely tasty and something a bit different for Christmas day as well.
Holiday Casa Cel Turkey…
Here is my personal favourite – it does have a touch of the bah humbug about it.. do nothing! Yes, I understand it seems really miserable but what I want you to do is sit down and work out exactly how much you are going to spend on Christmas – then I want you to take that money and put it in a savings account. In about 1 months time it is predicted that travel agents are going to have a massive sale in a bid to kick the tourism industry up the backside – and you can be ready to go with the money you have saved!
Whatever you are planning on doing this Christmas badcreditblog.org.uk wishes you a Merry Christmas – but what do you have planned? Let us know by posting below…!
Chancellor George Osborne has announced public sector pay rises will be capped at 1% for two years, as he lowered growth forecasts for the UK economy (were we expecting anything less?).
Not the best news
The number of public sector jobs set to be lost by 2017 has also been revised up from 400,000 to 710,000.
Borrowing and unemployment are estimated higher than originally forecast and spending cuts to carry on to 2017, he also stated.
Outlining his plans to MPs, based on economic forecasts from the independent Office for Budget Responsibility (OBR), Mr Osborne told MPs the UK economy was now forecast to grow by 0.9% this year – compared with 1.7% forecast in March and 0.7% next year, down from the 2.5%.
For anyone who has been following these events over the past 12 months, it’s not entirely anything surprising. Parliament stated they estimated growth to be level and consistent earlier in the year, whilst leading economists stated otherwise – who are you likely to believe?
Borrowing was falling and debt would come down but “not as quickly as we wished”. In 2011-12 borrowing is now forecast to be £127bn – up from £122bn forecast in the budget and, over five years, the government is expected to borrow £111bn more than predicted in March. – Again… nothing unexpected.
The Office for Budget Responsibility forecast that unemployment would rise from 8.1% this year, to 8.7% next year – before falling to 6.2% by 2016. Its earlier prediction that a squeeze on the public sector would mean 400,000 job losses over five years has been nearly doubled, to 710,000 – as a result of extra spending cuts pencilled in for 2015-16, and 2016-17. Am I the only one who thinks causing job cuts is not the way to get us out of this mess?
What were we expecting?
Chief Secretary to the Treasury Danny Alexander later told BBC Newsnight that the government did not yet know where the bulk of the £30bn additional cuts – £1.2bn of which is expected to come from changes to tax credits – would come from.
“We haven’t decided where those cuts will come from. It doesn’t have to be found quickly, that is in 2015-16 and 2016-17. In good time, well before the next election, we will set out precisely what the measures are to deliver those additional savings in the next Parliament.”
The chancellor conceded he would not now be able to eliminate the structural deficit and see national debt falling by 2014/15 as had been predicted. The structural deficit is now predicted to be eliminated by 2015-16, pushing it beyond the next general election. But after many years of broken promises, ghosted improvements and failing tactics we’re starting to get used to this.
If anyone feels like bringing some idea’s forward to reduce this mess, I’m pretty sure if you have a minor around the house they may have some better idea’s?
I get the feeling I’ll be looking back through this post in 2018 thinking – they still haven’t got this quite right…