Personal Loans
In this article, we share our best tips and steps to take if you’re struggling to pay your Personal Loans. You’re not alone and this isn’t the end of the road.
Personal loans are taken out for personal reasons. They can help you pay for something special like a holiday or home renovations, or to consolidate your debt (although that’s not always a good idea).
While personal loans usually have lower interest rates than credit cards, they’re still high compared to other types of credit. Make sure you understand their risks and always check the terms and conditions of your contract before you sign.
Things to consider when taking out Personal Loans
- A personal loan can sound good because it may offer a lower interest rate than other types of credit, plus repayments are spread over a long time. But keep in mind that the longer your loan term, the more you pay in interest. When comparing loans, make sure the term is the same for each loan so that you’re accurately comparing interest rates.
- Beware using a personal loan to consolidate debts. You may be tempted to continue to use the credit cards that you’ve just paid off with the loan. (One good tip is to practice paying down your debts. Start with the smallest ones first. Once you have proved to yourself you can pay off a debt, consolidation may make sense if you can get a lower interest rate. It’s also a good idea to close any credit cards you’ve paid off.
Learn how you can get out of debt fast
What happens if I can’t pay my personal loan?
- Draw up a budget, manage it closely and revise it when necessary.
- Don’t get deeper into debt. Talk to your household and get everybody’s buy-in to reduce debt. Close unnecessary accounts.
- Track your expenses by writing down every cent you spend. This will show you where your money goes and help you to see where you can save.
- Add income. Sell anything you don’t need and use your skills or hobbies to make extra cash.
- Contact your credit providers to negotiate an arrangement that will help you. For example, lower instalments over a longer period, or a consolidation loan.
- As you pay off one account, continue using that instalment amount to pay more on another debt.
- See if you can switch to a cheaper insurance product.
- Draw up a list of all your debts and decide which ones you should tackle first – by paying more than the monthly instalment, you can pay it off faster.
- Ask for professional advice. Contact Us
- Keep your eye on the future – sacrifices today will mean rewards tomorrow.
You might feel overwhelmed, but you have options and there are steps you can take yourself. But if you feel you need a bit more guidance or need help quickly, simply call us on 0410125036.