UK Loan Alternatives - Review
Your
Options
Depending on your circumstances and what it is that you require,
there may be a more cost effective means of borrowing money
than getting a uk
personal loan.
Considerations
to make are how much you need to borrow and
over what period of time.
There
are three alternatives to getting a personal loan and suggestions
as to when they may become a better option than a personal
loan:
UK Credit
Cards
If
you are looking to borrow a few thousand pounds or less, and
you need to borrow money over the period of time, then you
could consider a credit
card.
There
are a select few credit
cards that do offer outstanding value. For example, the
credit cards offer 0% interest on purchases for the first
six months then a variable APR. In this case even if you wish
to borrow money against the card for a year for a purchase
made, and you then paid off the card at the same rate as you
would have paid off an equivalent loan, you would make considerable
savings.
Disadvantages
of a credit card that you have to be extremely disciplined
in paying off the borrowed amount. Unlike a loan where a regular
monthly payment has to be made, the repayment amount on a
credit
card is your decision ( subject minimum monthly payment
). You can however set up a direct debit payment to ensure
you make regular credit card payments.
Repayment
amounts being your decision can also become a flexible advantage
as you can adjust your payments to pay off the loan far more
quickly, if your personal circumstances allow, or lower the
repayment one month if unforeseen circumstances come into
play. You can also benefit from the additional 'extras' offered
by some credit cards like cash back on purchases as well insurance
cover for items purchased with a credit
card.
Decided
to use a credit card instead of getting a personal
loan?? Then make sure you are very careful about which
card you choose. There is not point getting a card
that charges you interest at 17.9% APR when you could
in fact get a personal loan much cheaper.
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UK Remortgage
If you
already have a UK mortgage you could think about unlocking
part or all of the equity in your property. This is the difference
in value between your mortgage and the property's current
market value.
If you
need to borrow many thousands of pounds over a longer period
of time, then UK remortgaging your property may be the answer.
The main
advantage of UK remortgaging is that UK mortgages normally
have much lower rates of interest enjoy compared with personal
loans. UK Loans Central recommend
that you contact a financial
advisor to fully understand the pros and cons of remortgaging.
It
is always important to remember that everyone's requirements
and circumstances are different, so you should make
a decision based on these factors as well as the benefits
of each financial product.
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UK Bank
Overdraft
Bank
or building society overdrafts
usually charge an interest rate that is higher than a loan.
BUT you usually only pay interest for the days that you are
overdrawn. If you are in need of more money for just a few
days each month, this approach may be your best option.
When
deciding whether this approach is a viable option
or not, you will need to consider the interest rate
charged by your bank and any annual or monthly fee
charged for having an overdrawn facility. Always arrange
the overdraft with your bank in advance or you will
more often than not incur additional charges. Always
read your bank's terms and conditions in detail.
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