Thursday 10th of September 2009
Unsuccessful credit card applications could dent the credit rating of Britons, a claim suggests, although turning away from plastic and towards individual voluntary arrangement (IVA) advice could be a better option for many.
Switching to a cheaper credit card can be one way to manage debt, Confused.com asserts, however, cash-strapped consumers who get rejected for a deal could find they are less attractive to lenders further down the line.
Rather than rely on credit cards to cover expenses, Britons who do not have spare cash to splash may instead want to make headway into clearing their current balances with an IVA, rather than top up their unsecured debt.
An IVA can reassure credit card lenders that they will be paid, albeit on a longer timescale and at a lower rate of interest.
"It’s sensible to start by paying off the most expensive debt first, so don’t waste this opportunity to get rid of those costly credit cards," Joanne Garcia, head of credit cards at Confused.com, advises.
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 could help kerb reckless spending
