Don’t Depend On Being Able To Get An Unsecured Loan
As the economy in the UK continues to slow down on the back of the credit crunch, a large percentage of the population are beginning to feel the squeeze on their financial situation, even if they haven’t been doing so already.
With the cost of living continuing to rise and wages and salaries becoming lower in real terms, due to employers cutting pay rises and bonuses, many consumers are struggling to manage to make ends meet, particularly those who may have outstanding debts through personal loans and credit cards.
As many individuals continue to try and maintain their standard of living, whilst at the same time looking for ways to reduce their monthly outgoings, it is expected that there will be an increase in the number of people applying for unsecured loans over the next few months, according to the Consumer Credit Counselling Service.
Although some unsecured loan applications are likely to be for new purchases, or even to fund an individual’s lifestyle, the majority are likely to be taken as debt consolidation loans, to clear existing unsecured loans and credit card bills and reduce the monthly repayments to ease affordability.
However, as banks and other lenders tighten their lending criteria as they struggle with their own financial difficulties, the Consumer Credit Counselling Service has warned people that they should not depend on being accepted for an unsecured loan.
Unsecured lending is becoming increasingly less available as lenders are now taking a far more cautious approach to these loans and this has been backed up by figures from the Bank of England, which show that the number of unsecured loan acceptances was significantly reduced in the quarter leading up to September this year and this trend is expected to continue over the course of the next three months.
A spokesman for the Counselling Service said “People are approaching and tackling the credit crunch in the right way, by being thrifty, recognising overspending and cutting back on any past excesses and unnecessary luxuries.”
