There’s no doubt about it – borrowing can be complicated. With so many different borrowing options available, it can be difficult to determine which one is best for you. Sadly, many people may pick a borrowing option which simply isn’t right for them.
If you feel you fall into this category this article may be just what you need! We’ve put together 3 top tips to help you on your way to becoming a clever borrower and choosing the option that’s right for you.
ONLY BORROW WHAT YOU CAN AFFORD TO PAY BACK
Unfortunately, many of us borrow more than what we can afford to pay back. Quite often this is due to failing to understand the terms and conditions of your credit arrangement. Whether it’s a short term loan, credit card or mortgage; you can quickly find yourself in difficulty if you aren’t fully up to speed with what’s expected of you. Failure to meet the agreed payment terms can result in higher borrowing costs and can damage your credit rating which can make it very difficult to obtain credit in the future.
ORGANISE YOUR REPAYMENTS
It helps enormously if you always make your repayments on time. This ensures you avoid any late penalties and will assist in maintaining a good credit rating. Setting up standing orders and direct debits can be an effective way of doing this – providing you have sufficient funds in your account. Another tip is to set up your payments to leave your bank account soon after your pay day.
A LITTLE EXTRA GOES A LONG WAY
If you have a good month and you can afford to pay back more than the agreed amount, this is recommended great idea. Not only will this reduce your balance quicker, but you could also pay less in interest charges. Many loan providers now offer quick and easy methods of doing this. Here at Nextcredit, our customers have access to their own account through our online portal allowing you to log in, view your balance and make additional payments at any time.