Thursday 12th of November 2009
Almost 40 per cent of Britons refuse to apply for a credit card because they fear rejection will ruin their credit score - but a reliance on plastic could be overcome with the help of an individual voluntary arrangement (IVA).
Research by price comparison site Confused.com revealed that, despite the financial hit many have taken during the credit crunch, four in ten still believe that being turned down by a credit card company will make any loan hard to secure.
According to the website, it is people aged between 22 and 30 who worry most that a bad credit card experience could leave a long-term black mark against their name.
Joanne Garcia, head of credit cards at Confused.com, said: "The financially savvy young look to the future and see problems about not only getting a credit card or loan, but also to finding a decent mortgage."
But consumers looking for credit to help them survive the period of economic downturn may want to instead consider an IVA.
IVAs can help to clear existing debt by creating manageable monthly repayments to creditors, which could eventually put people on a sound financial footing with no need to consider further credit.
By Kimberley Parsons
- 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
- IVAs 'can help people hold on to property'
