Borrowing money: Financial advice you can’t afford to miss

It’s easy to borrow money these days, even if you have a poor credit score.

With flashy television adverts promising you untold amounts of money in a five-minute application, and the rising amount of authorised (and unauthorised) money lenders on your high street, you can easily borrow money without giving it the appropriate amount of thought required.

If you read one of our previous articles at, you will know how important it is to protect your financial future. Getting into debt is not going to help you, so in this article, we will give you some valuable tips when it comes to borrowing money.

Shop around

Don’t fall for the first offer you come across. Many lenders whack on a huge amount of interest with each loan, so it pays to do your research first. It may be better to get a short-term loan, such as those offered at, as you may find it cheaper than a longer-term loan that you will be paying off indefinitely. Whatever you decide, however, always go to an authorised lender, and not an unscrupulous loan shark.

Work out your budget

No matter what your reason for borrowing money is, you need to have a budget plan in place to ensure you can make the repayments. If your job is insecure or you think you may have difficulty paying the money back, curb the temptation and don’t sign on any dotted line. Especially when it comes to secured loans, you may risk losing your car or your home if you can’t make the payments on time.

Take out a fixed-interest loan

Mortgage providers and other lenders will generally offer you a fixed or variable interest loan. The latter may seem more attractive, especially if the rate of interest is lower than what you have found elsewhere. However, this may be a big mistake. The rate of interest may go up unexpectedly, and there is little you can do about it once you have signed a contract. Of course, the rate of interest may go down, but taking out a ‘fixed rate’ interest loan is less of a gamble, and you will at least be able to budget accordingly.

Be mindful of PPI

Payment Protection Insurance (PPI) has been all over the media in recent years. Many people have taken it out unknowingly or have been mis-sold it by their lender, and have since taken steps to get the money back. There is a guide to PPI at, so have a read and contemplate whether you need to take out insurance on your loan or not. In some cases, it’s a good idea, but you should still read the small print on the loan application to make sure it fits your requirements.

Beware of payment holidays

Credit card companies and lenders will often offer you a payment holiday, giving you the option of taking a break from payments for a short length of time. This is great news until you realise you are suddenly charged extra interest when the loan commences again. Again, read the small print on your loan agreement, and if you are going to be charged interest, don’t take up the offer of that financial vacation.

Bottom line

Borrowing money can seem like an easy solution to your financial needs, and in some cases, it can be. However, heed our advice above, and always do your research before you make any hasty and unwise decisions.