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Renfrewshire Community Plan 2008 - 2017 Top tips for buying on credit
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Top tips if you are considering purchasing on credit.
Most people struggling with debt in Scotland are aged under 30, and some can owe as much as £60,000. These figures emerged from a study by one of Scotland’s leading insolvency firms. The study also showed that credit card debt was the primary cause.
Using a credit card, instant credit in a shop, catalogue shopping, or a store card, are all forms of credit. If you decide to use credit, these ten tips will help you to borrow safely:
Prepare yourself
- Can you afford it? Before you commit yourself, make sure you really can afford the repayments - don't be talked into borrowing more than you want to borrow.
- Shop around for credit. The first thing you're offered may not be the best deal. There are many types of credit and numerous rates on bank loans, credit cards and hire purchase agreements. Don't pay more than you need to.
- Read the forms before you sign. Normally, once you sign, you can't change your mind - but if you sign at home or away from business premises, you will usually have a short cooling-off time. If you don't understand the forms, or any other rules, you can contact Consumer Direct.
- Check exactly how much you'll need to pay back. Add up the interest and all other charges, and ask yourself if it’s still good value.
- Compare the annual percentage rates (APRs). This is the easiest way to compare similar credit products. If you're looking at credit cards, for instance, go for the one with the lowest APR. Usually, the lower the APR the less you pay in interest. But be aware that sometimes low APRs are applied for a short period only.
- Watch out for other charges. Look out for add-ons like a broker’s fee or arrangement fees.
- Look at the length or term of the loan. Don’t just look at the monthly payment, consider how long you’ll be re-paying. The longer the loan period, the more interest you'll pay back.
- Watch out for optional extras. Sometimes, a credit deal will include payment protection insurance. If you don’t need or want it, tell the trader and ask for a cheaper credit deal without this add-on. Be especially careful if you are self-employed or you work on a short-term contract because most insurance contracts don’t cover such people.
- Using your home as security. If you don't keep up repayments on any secured loan, you could lose your home.
- Acting as a guarantor. Even if you just guarantee payments for someone else's loan and they miss payments, you'll have to repay the debt.
If you require to speak with an adviser for consumer advice, or to make a complaint about a trader:
- contact our partners, Consumer Direct on 08454 04 05 06.
- If Consumer Direct advice does not resolve your complaint, they will refer it on to us for further investigation. Please note that, depending on the circumstances, it may take up to 10 working days before we can contact you.
- For further consumer advice please visit the Directgov website.
Alternatively, you can complete the following form and submit direct to Trading Standards:
Consumer Complaint Reporting Form (PDF - 604kb)
Contact us
- email: ts.es@renfrewshire.gov.uk
- call in or write to us at:
- Renfrewshire Council
Environmental Services
Trading Standards
Renfrewshire House
Cotton Street
Paisley
PA1 1BR
