General Chat

If I could go back and give advice, it would be that it is better to buy a house if you can than rent. Buying it with parents money is best - but, if not possible, never borrow more than 2.5 x income.

If you need a car and cannot pay for a decent one, you can buy one for £300 which can let you down and be very expensive - or best to get a bank loan on as cheap an APR as possible. If buses and trains are bad, you often need a decent car to ensure you get to work.

Anything else, "free" credit can sometimes be ok if you absolutely know you can make payments.

And credit cards are ok if you don't borow against them - as DET says, they protect your large purchases.

But Rose makes a very important point. You can think your finances are in brilliant order and within 3 months you can be in terrible straits. That is something happening to a lot of people in both Britain and USA at present time. It is not always reckless and irresponsible people that find themselves in very precarious circumstances. :-( :-(

Well done to your daughter Brian ., clever girl .

Our daughter is in a similar position, although she has a bank debit card she has never had a credit card or a loan (she's probably got more money in the bank than us) so there would be no history for a rating agency or mortgage company to look at and she would stand a good chance of being refused.

Yes Hayley you are correct ... after all this thread started about a £300 telly

well the people I know who are in dire straits Sylvia, don't match your description, and have never touched the "pay day loan lark" in their life...but there you are, we obviously move in different circles.

I got the impression from Sylvia that debt she was referring to is people that live off credit or simply live to pay it, for instance I bet we know of someone in the neighbourhood especially when I was a child, that had the best money could buy new settees fitted kitchen etc all brought on credit or " up to their eyeballs in debt"
I always think we are debt free when actually we are not as Rose said we have a mortage however we are of a generation that bills paid first then play later ( if there is owt left) and the pay day loans scares me to dealth the amount of people I know getting sucked in to them is very frightening

A lot of the repossessions are caused by people taking out more loans to pay for the debt they already have ... pretty stupid , this pay day loan lark is just stupid anyway the bottom lie is if you take things that you cannot pay for they WILL have to be paid regardless of what life throws at you .. simple really ..

well yes Sylvia, but even NOT overstretching oneself doesn't help in times of 'disaster' so to speak... plenty of people out there right now who could easily afford the mortgage when they took it out,...redundancy, relationship break up, death of a partner, any number of 'outside influences' can affect people...hence the rise in re-possessions.

Well Yes Rose ... but I think this is exactly why people land in difficulties when you take on a mortgage or anything that needs to be paid up you should not be stretching yourself to the hilt so that when something unexpected comes up you are in dire straits , think we all know life never runs totally smooth and things will and do crop up that will need repairing or replaced .

Hard to save when you have given up a well paid job to look after a relative , hard then to avoid credit when the window comes off in your hand when you open it, hard to avoid debt when you are struggling to feed and clothe young children and keep a roof over their head.

Please don't class all 'debtors' as profligate, it isn't the case and gets right up my nose....circumstances are individual.... a mortgage is 'debt' or 'credit' , whichever phrase suits, but few people are able to buy outright surely?

Or the drip or the never never :-D

I also believe if you want something save for it ... funny how changing the word to credit makes it sound OK ... in my day it would of been called debt and it would of been shameful to be in debt .

It's a state of mind, itsn't it? (plus self control)

We charge anything over about £10 to the CC, but know that we have to pay it off at the end of the month. If the money won't be available in the bank account, we don't buy the item.

There are financial advantages to using a CC. Say you order an expensive item, or book a holiday/flight. If the company goes bankrupt, the CC company are likely to refund the cost. You might get a better deal on Goods if you barter and pay cash, but there is no protection if the ordered goods can never be supplied. You're waaay down on the list of creditors and are unlikely to get a full refund.

Kay it is , if you say live at home with your parents, if you share a flat for example and pay your gas bill monthly by DD then that will show as credit.

Thats the one thing I am gratefull for that Itsmytelly is a TT, because he is of the old school you save for it or nothing.

My Mum is a prime example she has never so much as had a debit card, bank account yes, but she draws money as she needs it, and every time we are shopping Mum will watch as I pay for mine on my debit card and ask me to pay for her's, when I why she thinks I am not actually paying for my goods. :-(

Its hard to get credit checks if you have no history of how good you are at having credit.

The more credit you have had/or got the better,as then a fair assesment can be made if you are a risk or not,! stupid really.

do have a look a the link - scroll about 3/4 of the way and there is a blue box
******
The Credit Checker

Quick check whether you are a good or bad risk.
It asks ten quick questions and estimates what your credit rating is like.

This isn't definitive, but if you want to quickly see how you fare, then...
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The link also advises "Get a 'quotation search' not a 'credit search'. If you're just trying to get a specific quote for a loan, ask the lender to do a 'quotation search' and not a 'credit search'. This means the enquiry won't have a negative impact on your credit score."

Thanks DET ... wont bother with the link I assume seeing as I have never had credit I will automatically have a bad credit rating .

We had that problem and got credit cards...was a slippery slope after that ......they're cut up now.....my own fault but used properly and sensibly it's a great way round it.

aivlyS, it is odd isn't it, but that's the advice that some of the Money Experts on TV give.

Try to get your own credit report on-line from one of the Credit Agencies, such as Experian, and they ask for CC details to run the report. Interesting reading and free as long as you phone to cancel within the trial period.

You can do it by post where it might cost something in the region of £2 (might have gone up a bit)

Have a read of this
http://www.moneysavingexpert.com/loans/credit-rating-credit-score