thedebtblog.co.uk

Do you simply choose to ignore your credit card bill? Large numbers of people in the UK admit to this alarming habit, but perhaps even more conearning is that these people also live in the false hope that their credit card bill will magically disappear! I cannot believe that people are so unresponsible with their spending and utlimately their debts.

Treating debt like this is a sure fire way to land yourself in very hot water. Lenders are tightening lending criteria so it’s becomming muich harder to get a loan.

People who ignore their credit card bills and then think applying for a loan to consolidate debts may find themselves with a declined loan application; especially if they have charges and late payments damaging their credit rating from previously ignored credit card bills.

There are, however, around 60 per cent of credit card customers doing the right thing and clearing their credit card bills in full, every month. With the credit crunch being felt by consumers through the recent interest rate rises on credit, particularly loan interest rates, and the bills that land on their doormats. It is encouraging to see that 60 per cent of credit card customers can still afford to repay their balance in full each month. It is essential that people do not rely on their credit card for every day spending because this will only lead to further debt problems.

You should seek professional advice if you’re worried about keeping up with repayments on loans, credit cards, your mortgage or any other form of borrowing.

A staggering 3.2 million of us in the UK own 5 or more credit cards. I suppose this is hardly surprising given the last few years in the UK financial services industry, credit has been made far too easily available to people who either don’t fully understand the financial products they’ve applied for or simply couldn’t afford to make their repayments on mortgages, loans and credit cards.

Don’t get me wrong there is nothing wrong with having 5 credit cards or even a couple of loans and a mortgage, it all boils down to how these debts are managed. If you can happily move balances from one credit card to another or pay off your credit card balances with a loan then as long as you can honestly afford to make substantial repayments, not just the minimum amounts, you have nothing to worry about.

For the people who have 5 or more forms of credit which they use to pay for monthly household bills or food shopping and cannot afford to repay these debts every month, you are in serious trouble. Struggling to keep up with repayments and still using credit to keep your monthly finances in order is a recipe for disaster and you should seriously consider seeking professional financial advice or debt advice.

The recent credit crunch and interest rate rises doesn’t seem to have put us off; with 28 per cent of people applying for more credit cards last year. Of the 28 per cent, 21 per cent applied for 1 credit card while 7 per cent applied for 2 or 3!

As I said credit cards aren’t all doom and gloom as long as you spend sensibly and do not use them to buy items you couldn’t afford previously. Because, in the long run, you can’t afford it!