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How to Pick the Best Bank

We all use banks or building societies for our current accounts, savings, loan, mortgages and other financial things. This means that it is important for us to make sure that we pick one that works well for us. There are lots to choose form as well and it can make a big difference which we pick. This is because some of the differences will be really significant to us. It is important to think about what we are looking for in a bank and this will help us to choose one that is best for us. Below are a few of the things that we might be looking at.

  • Cost – banks have different costs with regards to the charges that they make on loans as well as the interest that they pay out on current accounts. This means that choosing one bank over another can make a big difference to your financial situation. We tend to stick with the same bank and get all of our products from there, but it can be wise to compare them all to make sure that you are getting the best value for money form the one that you are with. Of course, costs are not everything as you will not want to get a cheap loan form a lender that you do not trust. Therefore, you need to also think of other things that will influence you when picking between different banks and building societies.
  • Branches – some people really like to be able to go into a branch of their bank and talk to someone about their money. If this is the case for you , then you will need to make sure that you pick a bank which does have a branch local to you or perhaps several branches in close proximity to where you live in case some close. Sadly a lot of high street branches have been closing and so you may want to find a bank which has branches in high streets in several towns near you so that you can be confident that there will be one near to you that you can use.
  • Online banking – some people much prefer online banking or perhaps mobile banking on an app. If this is the case for you then you will need to research whether the bank that you are considering will be able to provide this. You might also want to look into whether the websites and apps seem really secure as well.
  • Customer service – It can be really important to know that when you need help form the bank you will be able to get in touch with their customer service department easily. It can also be useful to be able to feel confident that they will be able to provide you with the help that you need and be polite and friendly at the same time. It can be worthwhile contacting them before you use the bank to find out what they are like.
  • Reputation – many people do worry about the reputation of a bank. It is wise to find out a bit more about them. Asking people, you know can be useful but also looking at online reviews as well. You will find there could be bias and also people like different things to each other, which means that you need to be careful and think about what you are looking for in a good bank to make sure that your requirements are the same as theirs because they might like or dislike a particular bank for reasons that are not important to you.
  • Well-known name – some people like to go with a bank that they have heard of. They feel that they will be able to trust a place they know of better.

Is it Best to Get the Lowest Interest Credit Card?

There are lots of different credit cards to choose from and when you are choosing one then there will be reasons for choosing particular cards over other ones. Most people will focus a lot on the interest rate though. They will want to make sure that they have a card which will give them a decent rate so that they will not have to pay so much for using it. However, this will not always be the best choice for everyone as it will depend on the way that you use your card.

If you Only Repay the Minimum

if you only repay the minimum balance on your card each month, then you will be paying interest for a long time. You will be repaying the interest each month and perhaps just a little bit extra to cut down what you owe just a little bit. This will mean that you loan will hang around for a long time. If you keep spending on the card, then it will last even longer and it will mean that you will be paying interest for a very long time. If you are in this situation then you will want to make sure that you are not paying more interest than necessary for the things that you are buying. Therefore, it can be a good idea to keep the interest rates as low as possible and then you will not be paying so much in interest. Interest rates vary between lenders and so it is a good idea to keep comparing them. It is possible to transfer the balance of credit card to another one and so this might be something that it is worth doing inf they have a significantly lower interest rate. You will need to check the terms carefully though as there might be a different interest rate for those who are just taking out the card, compared with those using a balance transfer. Get in touch with the card issuer and find out first.

If You Always Repay the Full Balance

If you always repay what you owe each month on your credit card then you will not really need to worry that much about the interest rate. You will not be paying interest on the credit card and so it will not be relevant to you. It might be better to have a look at other features which might benefit you instead. Things like looking at cash back cards might be worthwhile as you could make some money back on the card. These tend to be higher interest and so it will not matter if you use them as you will not be paying interest. You may also have preferences over which card issuer you like and by not having so much concern about interest rates you will be able to choose between them all. However, it is still wise to keep a check on the interest rates. This is because you may find yourself in a situation where you will be unable to pay the credit card and then the interest rates could be important to you. Hopefully this will not be the case and if you have an automatic payment to always repay your full balance each month, then there is no chance that you will forget to repay the card and so it will be much harder to not repay it in full. Try to also keep a check on what you are spending so that you do not make the card unaffordable to repay. It can be wise to check the balance a few times in the month so that you can watch out for this.

How to Pay off Your Credit Cards

Most of us will have a credit card as they can be extremely useful. However, if we start to build up a lot of debt on the cards then they might become a cause of stress to us or just very expensive. This is because if we do not repay our credit cards in full each time we get a statement we will be charged interest on what we owe. The interest rate on a credit card can be high compared to other types of lending as well and so we could end up spending a lot of money. Therefore it can be a good idea to think about making sure that we repay the cards as soon as we can.

Stop Using Them

It can be wise to stop using the cards for a while, until you have them paid off. This will mean that you will not keep adding to the debt. If you do this then as you pay some off you will spend it again and you will feel really demotivated and you will not succeed at repaying the card. You may find that you really need or want to use the card for a few specific purchases perhaps for security reasons. Do this if you have to, but do not use it all the time for everything that you buy.

Do Not Just Pay Back the Minimum

It is very important to make sure that we at least repay the minimum on our credit card. However, we want to try hard to pay back more than that if we can. This is because we will find that if we only repay the minimum, we will tend to only cover the cost of the interest and a tiny bit more and it could take years to repay the credit card if you leave it like this. Then you will paying interest payments every month as well. Therefore, it is much better to repay more than the minimum. In fact, it is best to repay everything that you spend each month and then you will never pay interest. So, once you have cleared the outstanding balance, change your monthly direct debit to repay the whole card balance each month. You will have to be careful with your spending to make sure that you will be able to afford this every time.

Prioritise Repayment

You will need to make sure that you try hard to repay the credit card. This means that you will need to prioritise paying it off over buying other things. Of course, you will have essentials that you will absolutely have to continue to pay for. Things like food, bills, loan repayments, contracts etc will all have to be paid as well. So, make sure that you cover those but then you also pay for the minimum on your credit cards. Then use any spare money that you have to pay extra off the card. Of course, you may not have much left, depending on how much you earn and what financial commitments you have so you may need to try a few things to help you to get more money.

To start with it can be worth checking to make sure that you are not paying too much for the things that you are buying. Most of us will buy a lot of things and we do not necessarily check the prices of all of them. Therefore, going through everything and seeing if we can reduce the prices will be really useful. Look at the higher cost items first, such as insurance, utilities and contracts. You may not be able to reduce them immediately as you may be tied in, but once your current deal or contract ends, make sure that you look around thoroughly to see if you can get it cheaper. If you do this for everything you are buying, you will spend a lot less money without going without anything and you will be able to use that extra money to pay off your credit card.

Top Tips for Reducing Debt

If you have a lot of debt you may have come to the point where you would like to reduce it. There are lots of possible steps that you can take but it can feel extremely daunting to know what to do and where to start. It is good to have a methodical approach so that you can focus on it and work through it step by step. Here of some suggestions of what to do:

Add up Debt

This is the hardest stage but it is important. Find out exactly how much debt you are in. Find out what you owe and who to. This is not a nice thing to do but it will enable you to move forward and start with repaying the debt. Do not let it alarm you either, even by just looking at the figures you are closer to repaying it.

Decide Which to Repay First

It is a good idea to think about which you are going to repay first. You will save the most money if you repay the one that is costing you the most first. This is probably the one with the highest interest rate. However, you might prefer to tackle a small debt and then you will be able to clear it more quickly and have that good feeling that one is gone. You may also have a reason for wanting the clear a specific debt early, perhaps because you owe money to a friend or family member or because you particularly dislike and get stressed by a certain debt. It is worth considering which order you want to repay them in.

Pay Minimum on Everything

Make sure that you are repaying everything you need to on all of your debts. There may be minimum amounts you have to pay or a regular repayment, make sure that you are prioritising paying these and that you have direct debits set up so that they get paid first. You do not want to concentrate on repaying one loan and forget the others, so it is really important that you make sure that you get those paid as well. Just pay the minimum though so that you can use any spare money you have towards repaying the loan that you have chosen first.

Whittle Away Selected Debt

Once you have done the above stages, you need to start to pay off the loan that you have picked. Firstly, you need to make sure that there is no fee for repaying it early. Some cash loans online have this and it means that you will have to pay extra and this could just be a small amount that is worth paying, but it could be a larger amount which could make it not worth repaying the loan early. You will need to think about whether you are going to still benefit by repaying it early if there is this cost. Once you have established this you need to start to whittle away at some of the debt. This will mean making higher repayments than normal. You may want to set this up so you just make a larger repayment each month than you normally do or might rather pay in lump sums when you have them or perhaps both. You will also need to decide how you will find this extra money. You might have some savings you can use, be able to sell some things you own and no longer need, find some extra work, perhaps online, freelance, temping or a second job or you might be able to reduce your spending in other areas by buying cheaper items or less of them.

Is a Fixed or Variable Rate Mortgage Better?

There are many different types of mortgage and it can be confusing knowing which one is going to be the best choice for you. There are differences between all of the mortgages available of course, but there are also some big differences between certain types. It can be good to know what these are and understand what they mean first and then this will help you to reduce your choice of mortgage and pick the one that will be the best for you.

Fixed Rate Mortgages

A fixed rate mortgage is one where the interest rate is fixed for a period of time. It is unlikely that it will be fixed for the whole term of the mortgage, but you will get a fixed rate for a certain number of years. This will vary depending on the mortgage provider but tends to be between one and five years. The fixed rate might be higher than the variable rate that is being offered.

The advantage of having a fixed rate is that you will know how much you will have to pay each month. There will be no need to be concerned about whether the rate will go up and make it hard for you to pay. These are especially good if you are quite stretched financially anyway and you feel that any increase in mortgage payments will be too much for you to manage. It is therefore worth calculating whether you are likely to be in this situation by looking at your bank statements and seeing how well off you expect to be. If you are taking on a mortgage for the first time, then it could be tricky to calculate this, particularly if you have not had your own home before as knowing how much all the other bills will be is hard to estimate. However, you might be able to have a go or you may feel that it will be better to get a fixed rate, so you at least know where you stand with one of your expenses.

It is worth noting that often with a fixed rate mortgage, you will be tied in and this will mean that you will be committed to staying with that lender. You may be tied in beyond the fixed rate period as well, meaning that you will have to be on their variable rate for some time. It is well worth checking whether this is the case. This could be a problem if interest rates fall or there are more competitive mortgages available as you will not be bale to move and take advantage of them. Some will let you move, but they will charge you a lot of money to do so. You may even find that this could be a problem if you move house, particularly if you downsize and want to reduce the amount that you are borrowing as they may not let you pay some off either due to the same penalty or condition. Therefore, make sure that you check first.

Variable Rate Mortgages

A variable rate mortgage can normally change at any time which means that you have no security with regards to knowing how much you will be paying month to month. However, you are generally free to change mortgage providers, which means that they will not want to make changes that are too drastic as they know that you will go elsewhere. If you get a tracker rate, then this has to track the base rate and so they will not be able to change the interest rate whenever they wish but only when the base rate changes. This can make things a bit more predictable and protects you form the mortgage lender just randomly putting up the mortgage.