Figures released by the British Bankers` Association (BBA) have shown that borrowing on credit cards has reached levels not seen since before the cold chill of the financial crisis hit home, so loans to consolidate them, either personal or secured, may be necessary if people struggle to pay back what they owe and do not have the savings to cover the balances.
Lending increased by 5.5 per cent in the year to April, which is the quickest rate since 2008. In financial terms, that means there`s a total of £57.7 billion outstanding on credit cards, up £1.5 billion from the previous year.
Borrowing on plastic actually decreased at some points during 2011 and 2012, but BBA economist Richard Woolhouse reckons that the figures show that consumers are getting `more confident about the recovery`, so they`re happy to take out credit.
The stats also show that over 40 per cent of all borrowing on cards is done during interest free periods or when the interest rate is at zero per cent, which is a great way to utilise the resource, as you don`t have to worry about paying back any more than the price of the things you`re buying as long as you pay the debt off entirely before the interest free period ends.
However, when these periods end or you find you have interest to pay, repayments can get steeper and for some they may become unmanageable. If this is the case if you need a larger amount and are a homeowner a secured loan may help to settle growing unsecured debt and leave you with a single lower payment to make each month.
As these are spread over a longer period, you`ll end up paying more interest over the course of the loan, but your adviser will seek to present you with the most suitable no-obligation secured loan for you from our panel so that you only have to pay back the absolute minimum.
Find out more about how consolidating debts through secured loans can help draw a line under out of control borrowing and help get your finances in order, get in touch through firstchoicefinance.co.uk or call us for on 0800 298 3000 on your landline, if you are mobile its 0333 003 1505.
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