Wednesday 23rd of December 2009
If you regularly search for personal loans and credit cards you could be damaging your credit reference without realising, although an individual voluntary arrangement (IVA) could improve your rating in around five years.
Concerns have been raised that Britons like yourself who shop around for the best deal are leaving a trail of marks against their name. When it comes to applying for future credit, you could be rejected or charged a higher rate of interest.
While it could be said that an IVA is a better answer to a serious shortage of funds than simply taking on more debt, the Treasury Committee has demanded an investigation into the practices of lenders.
"Christmas is precisely the time when consumers are likely to be feeling the pinch … While it is right to protect consumers from potentially reckless lending, equally they shouldn’t be penalised for shopping around for loans," says John McFall, chairman of the committee.
Rather than searching for the best personal loan, why don’t you see if an IVA proves to be a better solution? By merging your unsecured borrowings into a single, monthly and more manageable repayment, you could soon clear your debt and improve your credit rating after about five years.
By Ashley Littley
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- IVA could be the best Christmas gift this year
