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UK Consumers Are Quickly Repaying Debt

by Jim ONeil on April 1, 2012

in Debt

According to a report released by the British Bankers’ Association (BBA) on Friday, UK overdraft, credit card, and personal loan repayments have surpassed new borrowing.

For more than one year, UK consumers have been repaying these debts at the fastest rate, resulting in a £305 million net repayment, the highest figure since January 2011. Some consumers are reducing their interest payments by using cheap loans to consolidate and repay outstanding debts.

Credit card repayments during this period were £7.3 billion, exceeding the £7 million credit card spending figure. David Dooks, statistics director for BBA, reported that consumers and businesses are continuing their cautious approach to finances due to the fragile economy.

This is evidenced by the move to repay bank financing and hesitance to take on additional credit. Mr. Dooks noted that corporate and consumer confidence will soon be boosted by government programs.

According to experts, many UK consumers are using a personal loan to consolidate debt. This simplifies repayments and saves them money over the long-term. Consumers with a small amount of debt can use short-term, no credit check loans to repay their outstanding balances and overdrafts.

They should comparison shop for these to find the best loans APR and most convenient repayment terms. Though this financing is more expensive than loans bank offered, it is also much easier to obtain.

Websites that help consumers compare these payday loans and other types of financing provide a valuable service. They eliminate the need for people to visit each lender site to view its offerings.

Instead, loans offered by multiple lenders are displayed side-by-side on a single page. This makes it much easier to compare different aspects of the financing. Consumers can quickly identify the loans cheapest for them and can click to learn more or visit the lender website.

The economy in the UK is still very unstable, making it important for residents to exercise sound financial judgment. If their bills begin piling up, they should look for ways to reduce expenses or increase income.

If this is not possible, a low interest loan may be an acceptable way to repay high-interest balances on credit and store card accounts. Consumers can find and apply for a loan online in minutes and their bank account will be funded almost as quickly. They can use the cash to pay bills, pay off credit card balances, and cover emergency expenses.

There is no word when the UK economy will improve but recently increased mortgage costs indicate that it may not be any time soon.

Consumers are taking steps to keep themselves from falling deeper in debt. Unfortunately, unforeseen expenses can make this impossible. Thankfully, there is financing available that does not require a credit check and features almost instant approval.

When the time comes to consolidate debt or get additional financing, UK consumers should look no further than their computer. Loans bank provided have become extremely difficult to get due to strict lending criteria.

Payday loans and other non-traditional financing are there to fill the gap when consumers need money.

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