Managing Your Finances

One of the most frequent questions we are asked is how to get credit if you have had problems in the past?

The obvious answer would be to avoid it at all costs, but this is unrealistic. We can assure you that though there is life after debt, no matter how bad it seems today, it will get better, if you use this site and obtain professional advice.

Credit is an important part of everyday life. For example, for most people a mortgage is the only way to buy a house.

So we have laid out a guide to future credit and who will supply it.

Step One

Before you start looking at new credit you must ensure that all previous credit problems have been resolved. This means either paid up or settled via an arrangement. Don't be tempted to "forget" about outstanding credit - they won't forget about you. Imagine buying a new home, re-establishing some equity and getting your life in order - then 5 years later an old creditor puts a charge on your house!

If you haven't dealt with these problems you need to look through the rest of the site for ideas and help or get a free consultation.

Step Two

Planning Your Approach to New Credit

There are several key questions that a lender will want answered and that you should also ask yourself before you get more credit.

What Caused My Previous Problems?

Be prepared to set out in writing what happened. Explain the circumstances that led to the problems and exactly what happened. Don't be vague. Be prepared to provide evidence.

How Were They Resolved?

You should detail how you dealt with the problems. If you made arrangements to pay etc., explain what the arrangements were. You should detail how and when the debts were cleared or settled (whether in full or in part).

Evidence They Are Settled

You will need to obtain proof that the debts have been dealt with. In the case of a CCJ this will be a Certificate of Satisfaction obtained from the court. For informal settlements this would be a letter from the creditor. For IVA's, CVA's, bankruptcies etc., confirmation will be required from the Trustee or Insolvency Practitioner.

Credit Reference Agency

You should obtain a copy of your report and ensure that the information is correct. All settlements should be recorded as satisfied. If not, you will need to send proof of satisfaction to the agency and request that they update their records.

How Can You Prevent Recurring Problems

Lenders will be concerned about problems recurring. You need to be able to persuade them that this shouldn't happen. The points to consider are: job security, domestic stability, health, affordability, income stability and level of indebtedness. Some issues you can insure against, (redundancy, sickness etc), others are down to common sense.

What Credit Can You Afford?

Taking all the previous points into account you MUST make sure you can afford the commitment you are proposing. You should be able to demonstrate this by completing a budget form. Print this off and fill it in. Then ask yourself what if:

My income reduces

Are you relying on overtime or bonuses?

Interest rates increase

Have you left enough leeway?

Most important

Have I learnt from my previous mistakes?

Armed with this information you can now approach lenders with your proposition.

See Getting a Mortgage

Debt consolidation is the process in which debt is restructured into one low affordable amount which you agree to pay.

If you want honest, free advice on how to get out of debt without a debt consolidation loan then CONTACT US NOW.