How To Manage Your Debt
Debt. Even the word carries a lot of weight, but nothing compares to the trying times and struggle of actually being in debt. Debt can ruin lives and break families apart.
Gambling debt, credit card debt the list is endless, and the more debt you have, the more overwhelming it is. Debt can mount up over the course of time, and managing it all proves even more stressful.
Separate payments can be difficult to keep track of and at times, impossible to manage.
The UK’s Looming Household Debt
Recent reports from various news outlets have found that the government is aiming to reduce the national debt annually. Whilst this is within the government’s grasp, it could not be more of a different story for households in the UK.
Statistics have found that compared to other countries around the world, the national average debt for UK households is 150% of the average income.
In the past 5 years, student and car finance debt has more than doubled, with a 2% rise in mortgages, a 12% rise in council tax, and a 19% rise in consumer credit debt – The Independent found that 10% of credit card users have ‘maxed out’ their credit cards.
The total household debt has increased by a total of 7% since 2012, making the total debt standing in the UK £1,630.1bn in the year 2017. On average, there is an estimated £8,000 worth of debt, per person in the UK.
With interest rates creeping up, mortgages have risen in cost, but savings will see an increase as well. However, when you’re in debt, savings are pretty much non-existent.
With repayments on credit cards and other debts stacking up, what can you do to get on top of your debt and manage it?
Debt consolidation loans are a more manageable way to get in control of your finances. Paying off a credit card, car finance, and other debts in one go – by organizing them into one affordable monthly repayment.
Now, this is ideal for most, loan companies will not approve you for a personal loan if your credit rating is less than desirable. And why do you have bad credit?
Because you have been unable to maintain repayments on your other outstanding debts, it’s a vicious and blameless cycle. But this is how to manage it. Where there’s a will, there’s a way, and this way is an ideal choice for those with bad credit.
Manage debt with guarantor loans
If you’re still reading, then you’ve probably got a bad credit score and debt. The good news is, that there’s a more affordable and easier way to manage any and all outstanding debt you may have. You may be wondering what a guarantor loan actually is.
Essentially, lenders who provide guarantor loans use a trust-based lending system. You need not provide your credit history to them, all that you need is a guarantor who is willing to co-sign the paperwork to agree to support your loan application.
You’re probably wondering who can be your guarantor. Well, they can be a friend, family member, or even a partner, anyone who has good credit, is between the ages of 18-78 and agrees to cover any repayment on the loan you are unable to meet.
If they’re a homeowner, it’s a bonus, but if not then most guarantor loan providers, like TFS Loans, aren’t that concerned – it won’t impede your application.
Why a loan?
The last thing you want to think about when you’re in debt is borrowing more money, but one way to manage all your debt more easily is to merge it into one affordable payment. So, with a guarantor loan, you can pay off all your other outstanding debts and manage them into one payment.
Most loan companies can lend enough to consolidate all your debts. One provider, TFS Loans, can lend loan amounts from £1,000 to as much as £15,000, so even if your debt is significantly larger, you could still cover the costs.
Guarantor loans are more affordable and have significantly lower interest rates than other bad credit loans. Payday loan companies have staggeringly high representative APRs, and usually with a shorter repayment time. Trying to get a fair rate on a credit card is impossible to get if your credit score is bad.
However, guarantor loans can be paid back over a longer time. You can stretch the repayments over up to 5 years, making the repayments more affordable.
It is always important to seek independent financial advice before taking out a personal loan. Guarantor loans may only be beneficial for those with bad credit. Taking out a loan you cannot afford to repay can cause serious money problems.
Consolidate all of your debt into one affordable and manageable payment, regardless of your credit history. Instead of juggling separate payments and attempting to keep track of how much debt you have left and when they have to be paid etc.
With a guarantor loan, you can pay off all your debts with one almost instant payout (TFS Loans and other loan companies could approve your online application within 24 hours).
With significantly lower representative APRs than payday loan companies, it’s a much safer and more secure option to consolidate all your debt in one payment.
About The Author:
Hugh Sallows is a Content Marketing Executive for Revive Digital. Writing content for magazines, blogs, and websites, Hugh has an extensive history of writing. Hugh is currently researching and writing in Finance, specifically working on guarantor loans.
