With the recession still biting hard across the country, it’s not surprising to know that the number of people looking to borrow money from lenders and loan providers has risen quite significantly in recent years, with quick-hit payday loans seeing the biggest increase of over 400%. Of course, borrowing money isn’t a bad thing at all providing you can comfortably afford the repayments — what matter is how you actually go about finding some money to borrow.
Obviously, there are multiple ways to borrow money, all with varying levels of risk. Something as simple as a bank overdraft, for instance, is technically a means of borrowing a certain amount of money as and when you need it, although because you don’t actually get a lump sum of money to spend until your account dips below zero, it’s rarely a means of borrowing that people think about. The most popular form of borrowing comes in the form of loans, although these too can be broken down into many different kinds. Unsecured (or personal) loans are the most sort-after since they require no risk on your part, but carry higher interest rates than secured loans which have to be taken out against assets you own, such as a house or car. Payday loans are short-term agreements (usually for small amounts of cash) that have high interest rates to make up for the short periods that the loans run over, while Bad Credit Loans are designed specifically for people with bad credit histories and generally have higher interest rates as a result to protect the lenders from greater risk.
On top of that, there are yet more ways to borrow money if you move into the world of mortgages — which are essentially massive loans purely for buying property with — or credit and store cards, both of which give you access to money that can be spent on all manner of items on the high street. Again though, many people don’t see these as ‘borrowing’ in the proper sense and only consider loans as the true way to borrow money.
All that said though, the important thing about borrowing money is that you can’t do it if you circumstances don’t fit the criteria set out by the lender you approach. As 借款 such, it’s crucial that you only apply for loans, mortgages or credit cards that you have a chance of getting — applying for a regular loan when you’ve got bad credit will see you get declined, which will only make your bad credit worse. It’s all a matter of getting the right borrowing for the right situation and in many cases, you can save a great deal of time by using a decent broker to help you find the product you need.
You can borrow money…
By approaching your bank or building society for an overdraft, credit card or loan
Through a number of smaller dedicated lenders or loan providers in the UK
For all kinds of reasons from buying houses, cars and holidays to everyday spending
If your circumstances match what a lender is looking for in a borrower
Providing you can afford the repayments and act responsibly
Copyright: Individual Finance, 2010
Individual Finance has informative articles on how to borrow money [http://www.individualfinance.co.uk/borrow-money/], different types of cheaps loans [http://www.individualfinance.co.uk/] and many other aspects of UK finance. It also keeps users up to date with the latest money-saving offers and vouchers through regular e-mail newsletters.
Martin Mathers writes for Individual Finance — he’s a professional journalist and writer with 12 years of experience under his belt, covering everything from finance and business to movies, music and technology.