Many unemployed people have finance outstanding when they lose their jobs, or get it while unemployed to tide themselves over this difficult period. But you have more options than you think, both in getting finance and in changing its terms once you have it. This article provides some great tips to make sure you aren't paying more than you can afford.
Mortgages and Loans:
If you can get away without them - fantastic - if not make sure you get the best deal. A newly emerged loan option is peer to peer lending, where you bypass the banks and financial institutions and borrow from people. Zopa is one such organisation. It's lenders offer some of the best rates around.
Credit Checks:
Whenever you apply for loans and cards the lender checks up on your credit record - these are not always accurate and you can be turned down for loans due to errors on your credit report. You can get a free trial which allows you to check it yourself from http://www.creditexpert.co.uk - they welcome corrections.
Credit Cards:
The most expensive way to buy anything is on credit - if you don't already have a credit card - don't get one! It only makes things cost more unless you pay off the balance each month. If you already have outstanding balances on credit cards which you have had for a while it is a very good idea to transfer them to cards with low interest rates so that more of your monthly repayment actually goes to repaying the debt. If you are paying 20% or more APR you are really being ripped off.
The credit crunch has lessened the number of good offers out there somewhat but some companies still offer 0% interest on balance transfers and/or purchases for a certain time when you switch. Applying online is quite painless too.
The quickest way to get rid of credit card debt is to first arrange the lowest interest deals possible (remember it is worth asking your current lenders if they would give you a lower rate - tell them you're thinking of changing cards and they might be persuaded!), then pay the minimum monthly repayment on all but the most expensive card - pay as much extra into that as you can manage until it is gone - then move on to the next most expensive. It takes determination and staying power to do this as it may take years but it is possible - the more frugally you live the quicker you can do it and YOU CAN DO IT!
If your credit cards and loans have spiralled to unmanagable repayments you do have the option of refinancing to lower the payments. Loans like this are often secured on your home and may take you longer to pay off but can be a lifeline at times.
Insurance:
Whether it's house and contents, car, pet or any other kind of insurance it really pays to shop around - contact lots of different companies for quotes. Policy Expert compare house, contents and other insurance for you and have excellent customer service.