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Base rate stays at 0.5% -what does that mean for people with bad credit?
The base rate in the UK has not been changed since 5 March 2009, for a total of 21 months. But what does that mean for people who have bad credit or are struggling to pay their debt?
By: Laura Wolf Solvemybadcredit Uk
First of all it means that the cost of credit is not looking to be increased in the near future. So if you are tinking about consolidating your debt into a loan that provides you a lower payments than you are paying on all your credit products at the moment, you are going to be able to do it.
Unfortunately it does not mean that people with bad credit are going to get accepted much easier in the future. Banks are still cautious about lending to people with bad credit and you are likely to get higher interest rates than the representative or advertised APR on the different credit products. If you still can reduce your payments with a consolidation loan and are looking to be better off in the new year you should start that consolidation plan right now.
Banks have been encouraged by the Government to lend more money for people and businesses in the last few months, but unfortunately they can still go around it by changing their acceptance criteria and making it harder to obtain credit. So if you are thinking of it check your credit rating is suitable for that particular loan or credit card deal, otherwise you might just end up with damaging your credit rating.
If you are thinking about consolidating your unsecured debt into a secured loan and you do have an equity on your home you are more likely to succeed, and you can secure yourself a better deal than taking out an unsecured loan. As secured loans are more dependent on the base rate that has been quite low for a while.
Consolidating your debt into one big loan does require careful planning and budgeting. Find out what you can do about solving your bad credit by reading honest reviews of debt management companies on my website.
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