Frequently Asked Questions on Credit Cards

When used sensibly, credit cards can be an incredibly convenient way to pay for products as they can spread the cost of a purchase and may even earn cashback. However, many people are unsure over many parts of credit card usage so we have compiled a guide to help inform those with questions.

Should I Repay Credit Cards or Save Money?

In the days when borrowing was cheap and savings account rates were healthy, the savvy investor knew the logical thing to do was to save or invest. In the current climate with saving accounts offering such poor return on investment, it just doesn’t make sense to retain debt, as the cost of debt is much higher than the benefits from savings. To put it simply, the money that you save in a bank account is repackaged by the banking system and lent back to you at a much higher rate. Want to consolidate your credit card debt? Some savings are necessary, especially if there is an uncertainty about the security of your job. If you lose...

Transferring Credit Cards

Do you have credit card debt on several cards or are paying a high interest charge on your current credit card? Transferring and consolidating your balance to a new 0% or low APR 'balance transfer' card can save you £100s and help you manage your finances better. What are the benefits of switching credit cards? The benefits of switching all your debts to one balance transfer card means you could benefit from a 0% interest free period. However, most credit card companies apply a balance transfer fee which may offset any savings you make. What credit card should I transfer to? The right type of card depends on, how much debt you...

Reward Credit Cards

Want to be rewarded for using your card? If you have good credit history and regularly spend on your credit card then you could receive some great rewards, from cash backs to air miles. The rewards card is a credit card which gives you rewards as you shop and spend on your card and it’s a great way of getting something for nothing. The rewards can be anything from cash back to air miles. The rewards card is best suited for people who regularly spend on their credit card but also clear their outstanding balance in full each month. This is because the APR on these cards are usually higher than average and any interest charge would...

Balance Transfer Credit Cards

Interest free periods on balance transfers can last up to 18 months. However, you should expect to pay a transfer fee of about 3% of the balance transferred to your new credit card. Interest building on credit cards can be a real burden, particularly when you’re struggling to pay the credit card off but those interest charges are making life more difficult than it needs to be. If you wish to temporarily halt interest charges on your credit card, giving you the chance to significantly lower your outstanding balance then applying for a new credit card with a 0% interest period on balance transfers is a great idea. Again it should be...

0% Interest Credit Cards

Zero percent (0%) interest credit cards offer you an interest free period on purchases at the start of your credit card’s life. These cards are very appealing, particularly the idea of spending hundreds, if not thousands, of pounds on a credit card without accruing interest. What you must remember is that if you spend more than you can afford to pay off within the interest free period then the interest will quickly build once the free period is over. What about card repayments? It is also worth noting that you still have to make the minimum card payments, usually a percentage of the outstanding balance each month, during the...

Car Finance Explained

Car finance refers to the way in which a car is bought. It can be done in a number of ways, such as by taking out a personal loan or through hire purchase. There are many options to choose from, all of which have positives and negatives attached. While car finance can seem a scary proposition, in reality it’s fairly simple. All you need to do is decide which method suits you best, and then choose the provider who offers the best product of this kind. Personal loan Personal loans are the most popular method of car finance, because borrowing in this way will give you almost instant ownership of the vehicle. There are a number of...

Credit cards and cash advances

Credit cards are a type of personal loan that is paid back on a revolving basis. Payments on these are determined by the balance of your account and by the interest rate charged. You may also be able to use a credit card to take cash advances, but this comes with risks as you may incur fees and higher interest rates by doing so.

Instalment loans

Instalment loans are used for specific amounts of money, and are repaid through instalments of equal size. They can be either secured or unsecured. Usually, instalment loans offer fixed rates of interest and are used for a ‘one-time expense’, such as a holiday or car purchase.

Variable rate loans

On these loans, the interest rates will change based on a schedule set out in the loan terms. Variable rate loans may also come with a cap to limit the change in interest rates, either at each point of adjustment or over the entire course of the loan.
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