Secured loans could be more suitable for those with credit cards
August 1, 2007
A recent report has suggested that those with credit cards in the UK may be better off with a secured loan in many cases. There is a huge debt mountain in the UK, and a large chunk of this is made up of credit card debt, with many cardholders losing control of their spending on credit cards. Many have ended up with high levels of bad debt on credit cards, which has added to the concern over consumer debt levels in the UK.
According to the results of the recent research an increasing number of consumers are unhappy with the service that they receive from their credit card companies, and taking other factors into considering such as high interest rates, fluctuating repayments, and ease of losing control of spending on the card, it could be that many consumers that own their own homes could actually be better off with a secured loan rather than sticking with their credit cards.
Consumers with their own homes can take out a secured loan against their property, and this can then be used to pay off any existing credit card balances, which will mean just one more convenient repayment for the consumer rather than having to deal with several credit card repayments. It can also mean better self control when it comes to spending, and reduced interest taking into account the high interest rates linked with credit cards.
This is also an option for those with bad credit credit cards, as they are often charged far higher rates on their credit cards, but can get some very competitive deals on homeowner loans, which could work out more affordable than a range of high interest credit cards.
Alan Wright
1st August 2007
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