| Loans are handy for buying things you may need, like | | | | pay for a large item such as a car or a holiday. Most |
| a new car, or for financing other needs you may have | | | | lenders will offer you up to 15,000 pounds. The interest |
| like money for your business. But getting the right loan | | | | rate may vary depending on how much you borrow |
| can be tricky so here's some advice that should help | | | | and over what period of time you agree to pay back |
| you. | | | | the loan. Generally you can pay it back over 12 - 96 |
| At the outset it is important that you consider how | | | | months. It is important to remember that if you pay |
| much your can comfortably afford to pay back. Loans | | | | back your loan over a longer period, the monthly |
| typically need to be paid back in monthly instalments | | | | repayments are usually smaller but you pay more |
| so work out how much you can pay back each | | | | interest because you have the loan for longer. |
| month. A lot of people run into trouble when they | | | | Some banks offer you the chance to combine all your |
| agree to pay back a certain amount every month only | | | | financial commitments into one loan with a fixed |
| to find out later that they are struggling to meet their | | | | interest rate so that you can pay your debts off |
| commitment due to some unforeseen added | | | | gradually by making one payment each month. |
| expenses. As a rule of thumb work out how much | | | | A secured loan gives the lender the security of |
| you can pay back after comfortably paying for all your | | | | knowing that if you fall behind on repayments they can |
| other expenses. Your loan pay back amount should be | | | | claim the money back by repossessing an asset that |
| an amount that you do not really miss. If it would be | | | | you have secured the loan against. The most common |
| taking a big chunk from your disposable income than | | | | way of securing a loan is to take out a mortgage on |
| the chances are that the amount is too much. | | | | your property. If you fall behind on repayments the |
| Who can get a loan? Most reputable lenders will need | | | | lender can apply to the court for a repossession order |
| you to meet certain conditions. You will have to be at | | | | and then claim the house or whatever you have used |
| least 18-years-old, resident or ordinarily resident in the | | | | as security to repay your debt. |
| UK, have a good credit record and receive a regular | | | | Secured loans tend to be cheaper because they are |
| income. Some lenders may ask for a deposit and also | | | | less of a risk for the lender but you should always |
| charge a set-up or administrative fee. | | | | consider the implications if you fall behind on your |
| Applying for an overdraft with you bank is one good | | | | repayments. |
| way of getting a loan, especially if you need cash | | | | A lot of banks and building societies will offer you |
| short term or a facility where you can get access to | | | | payment protection with your loan. For a small monthly |
| extra cash when you need it with little or no notice. | | | | fee this ensures that your repayments will be paid if |
| Credit cards can also be very handy as they allow | | | | you find that you are made unemployed, are sick or |
| you to buy goods or services or get access to cash. | | | | have an accident. In most cases if you die your loan |
| They can also be very useful in the case of | | | | will be paid in full for you. |
| emergencies. Caution must be taken though to not run | | | | Finally, a word of warning about 'loan sharks. Be very |
| into a vicious cycle of paying back high interest | | | | careful when you choose a lender. Make sure you use |
| charges where it can take a long time to be able to | | | | a reputable company, as some of the more |
| pay back what owe. If you are gong to use a credit | | | | unscrupulous lenders can often charge very high rates |
| card for a substantial outlay, work out a plan | | | | of interest that make it difficult to pay the money back. |
| beforehand to pay back the amount as it not incur too | | | | Check what you are committing yourself to before |
| much interest over a long period. | | | | you sign any contracts. |
| Personal loans are especially suitable if you need to | | | | |