Missing loan repayments can be fatal to your credit rating and your assets. While our personal loan brokers do all that they can do give you the best deals possible, here are some additional simple tips to help you manage your personal loan repayments.
Create a Budget
It is vital that you keep track of how much money you need to set aside for your repayments before you start spending your monthly income. There are a range of budgeting apps that you can use to help you use this. This brings us to our next point.
Set up a direct debit to repay your loans
A direct debit will eliminate the temptation to spend money you need for repayments. A direct debit takes care of this temptation. This not only reduces temptation but also stress and removes the possibility of you missing a repayment, saving you a lot of money in the long-term.
Consider Refinancing Your Personal Loan
Your credit score will improve as you make timely repayments. This has the knock-on effect of reducing your interest rates too, even more than that of your current debt. If you find yourself in such a position, as many of our clients have, consider looking for a better offer which will save you money on interest payments.
Repay your personal loan from the right bank account
Withdrawals made from savings account and ISAs will cost you money in lost interest payments. Therefore, you should pay your monthly instalments via a current account.
Communicate with your broker or lender
Your lender has an interest in you paying back your loan on time, after all, they also bear the risk. If you are juggling multiple debts and consistently failing or struggling to make payments, you should definitely speak to your lender to see what they can do. Additionally, telling your lender early may prevent them from filing a County Court Judgement (CCJ) against you, this can cause you to lose up to 600 points on your credit score.
Falling behind on loan repayments can be difficult. It is a risk for both you and your lender. However, judging from out experience, there is always a manageable way out. Consult our personal loan brokers for further advice.