Speak to any random person on the street about their credit history and the chances are that most of them wouldn’t be able to tell you what their credit score was. And why? Because it’s just not something that’s immediately obvious; in fact, most people go through life assuming that if they ever wanted credit, they’d get it without any trouble. The truth, however, is rather more bleak – of all the people you’d stop to talk to, the odds are that 1 in every 4 people stopped would be suffering from a bad credit history. Surprised? Considering the current recession biting everyone in the pocket, you shouldn’t be…Unfortunately, it’s not all that difficult to find yourself with a bad credit history since a great many things can nibble away at your credit rating without you even realising it. Of course, some of the causes are rather obvious: for instance, if you take out a large loan and then decide to miss a few monthly payments for no good reason, fail to discuss it with your loan provider and then ultimately default on the entire amount, it’s incredibly likely that you’ll end up with a bad credit history. The same goes for failing to pay off a mortgage and having your house repossessed, taking out credit cards and then not paying back the money spent on them, earning County Court Judgements (CCJs) or declaring yourself bankrupt – all fairly obvious reasons for bad credit, since they’re all rather extreme and not normally something that most of us would deliberately do.However, it’s often the accidental problems that end up leaving the stain of bad credit on your financial history. Many of us, for instance, may have missed paying a utility bill on time purely by mistake and found ourselves in receipt of a ‘red bill’ demanding payment, which counts – albeit in a tiny way – towards how the big credit reference agencies like Experian and Equifax view you as being responsible with your finances. The same goes for accidentally going overdrawn on your bank account (incurring charges in the process) or overspending on your credit card; even if you correct it shortly after the event, it still gets recorded on your credit history. And perhaps most importantly if you’re currently in the market for a loan, constant applications and rejections for loans in a short period of time can result in your credit score being devalued, since the repeated checks carried out on your credit history for each application raise red flags to lenders and loan providers.Thankfully, there are plenty of ways to prevent getting bad credit: pay your bills on time, keep your borrowing to a minimum and generally try to live within your means. And even if you do get a bad credit history, it’s not the end of the world – thanks to the creation of Bad Credit Loans and credit cards designed expressly for people with bad credit, it’s possible to repair even the worst credit history over time. So long as you can act responsibly with your money, anything’s possible…In SummaryBad credit history…Affect nearly 25% of all credit-eligible people in the UK today
Is easier to be burdened with than you’d think
Can prevent you getting credit or loans in the future
Is avoidable if you pay bills on time and stay within your financial limits
Can be repaired with Bad Credit Loans and be being responsible with your moneyCopyright: Individual Finance, 2010
10 Tips Before Applying For Payday Loans
1. Automate the debt payment – Payday loans are issued to individuals who have a stable source of income. In other words, your application will be approved only if you have a regular income or salary every month. It would be so much simpler if you can just repay the debt with the money you receive next month. However there are some people who are not able to do that. They would spend the money elsewhere and be left with little for the repayment. So visit the bank and automate the debt repayment. The money should go to your creditor as soon as it reaches your bank. You can spend the balance left in your account. In fact most creditors have the automate payments forms with them. Just ask them and they shall be able to provide you the same. If you take a loan from us, you have the option to make the repayment in an automated mode. On your payday the cash will be directly debited from your account and credited to our account automatically. You may forget to pay so this is the safest route to avoid late payments. Some people have cash but forget to pay, so automating the payments is a great way to avoid late fees. In fact you must automate your payments for all your credit cards.2. Cut your expenses – You are in debt, so the last thing you should do is spend a lot of it. Make this the central objective of your life for the time being at least. So go ahead. Reduce your expenses wherever you can. Make a plan. Go back to the drawing board and see where you can cut the expenses. Get rid of the costly cell phone plan or cable package. Get something simpler. Try to reduce your grocery budget. There is always something you can do without. You can get rid of the debt easier this way, and will also be left with money in your account that you can save every month. This will help you in the long-term.One of the best ways to stop spending on things that you do not need is to stop watching TV or reduce watching to a large extend. They show all kids of excellent advertisements and we are compelled to buy. Just do not see them and you stop buying products with little or no use. And of course save money.2. Increase your income – Have you ever thought of trying to earn more money? By doing this you will certainly be able to pay off the debt quickly. A second stream of income may help you avoid taking a loan in the future as well. Contrary to what many believe, earning a second income isn’t really that difficult. For instance, you could sell off all those unwanted things you have on eBay. You will make some quick money to pay off the debt, and will also be able to reduce the clutter at home. You may also start a blog to make some extra cash for the long-term. Or you may find week-end jobs. There are plenty of ways to make some extra bucks. You just need to try.3. Make small payments – The term of a payday loan is small – you have to repay the money after receiving next month’s pay check. But if you can make some extra cash in the meantime, then you may consider paying off a portion of your debt with it. This will help you keep your burden in check, and will make it that much easier for you to repay later on. Plus, if you keep repaying, then you won’t be wasting the extra money you are making. Find out from your payday lender if you are allowed to make small payments in the middle of the month.4. Is there a prepayment penalty – Sometimes there is a prepayment penalty if you pay off the debt early. Ask the creditor while you are taking the loan. If you have taken a loan already with the penalty, then calculate how much it would be in money terms compared to the interest you will save if you pay it earlier. This will help you arrive at the right conclusion on whether you should pay off early.5. Lower the interest rate – Try to negotiate with the lending company if you can. See whether they are willing to reduce the interest rate. Sometimes, a few companies will oblige, because they too want to do business. These agencies might agree if they see that you are serious about trying to repay your debt. It’s always going to be easier for you if you have to pay off the debt at a lower interest.6. Borrow against life insurance – One advantage of a payday loan is that, you can get the money you need very fast. It can be transferred to your bank account in 24-48 hours. That is perfect in an emergency. But once you have the money, you will have some time in your hand. So you can try other options. For instance, you can borrow against your life insurance and other savings and policies to repay your existing debt. Yes you will be receiving less money later, but that’s a small price to pay for leaking cash at this point in life. Life insurance interest is below the commercial rates, so you will be saving more than you spend.7. Borrow from your 401(k) – Similar to the point above, you can borrow up to 50% if you participate in a 401(k) retirement plan at work. So see how much money you have in your account and take out a portion of this to repay your debt. Don’t worry. Payday loans are small dollar loans anyway, so you won’t have to take out too much money.8. Renegotiate the terms – If for some reason you see at the end of the month that you cannot still pay back the loan, then try to renegotiate the terms with the creditor. Convince the lending agency that you remain serious about paying it back, and there will be many who will try their best to help you. Perhaps your fees or interest can be reduced. You never know unless you ask. After all, the payday company too wants to get the money back. Our lenders will co-operate with you if you inform them well in advance that you will repay your loan but you need some time. Our lenders will work with you to find a plan that works best with both you and the lenders. But please inform them at least one week in advance.10. Get eligible tax deductions – Are you getting all the lucrative and eligible tax deductions? You will be surprised to know that many people don’t get this simply because they don’t know the details. Get professional tax help if you need. This will help you in your long-term financial health. You will have extra money with which you can pay off the debt. In fact, you may not even need the loan
Contract of Employment – What it Should Include?
When you start in any new job, you should receive a list of employment terms (also sometimes known as a ‘statement of terms’) within two months of your start date. But these documents can be long, full of legal terminology and written in very small print. The temptation is to sign it without reading it thoroughly, but does your contract contain everything it should?Why have a contract at all?A contract of employment is an agreement between the employer and employee laying out clearly what is expected of both parties during your time with the company. A statement of terms is the bare minimum required by law, but it doesn’t offer full protection of the worker’s rights. A contract of employment is a more detailed document, listing in full the terms and conditions under which you are expected to work, as well as clearly stating your rights as an employee.A comprehensive contract of employment allows an employer to specify an employee’s duties and responsibilities, so that you as employee know exactly what is expected of you.What should it include?The basic details will be included, such as the names of both parties, the employer’s organisation details and your full name and address. It will also include the employment start date. This is more important than you think, as it signifies exactly how long you have been working with an employer further down the line (particularly important for redundancy or holiday payments, for example). It will also often include a proviso stating that employment with a previous employer does not count towards the various rights you may gain as an employee with one or two years service. The only exception to this is if a new contract is initiated by an employer who has taken over another organisation with existing employees, as their employment rights are maintained.The contract will also contain specific information on holiday and sick leave entitlements including maternity and paternity leave, hours and place of work, and salary. There will also be details and specific descriptions of the employee’s job title and duties, any probationary period and assessments, the notice period given in the event of either party terminating the contract of employment and any pension rights.One aspect that is often overlooked in contracts of employment is the restrictive covenant. This is becoming an important aspect of contracts of employment, particularly as electronic data storage becomes the most common method of documentation within organisations. It protects all confidential and commercially sensitive information belonging to an employer, and is designed to prevent an employee from setting up a competing business whilst still employed within the organisation. It may also have clauses that prevent an employee from setting up a rival business for a set period of time and within a defined geographical location.Finally, there will be details on the company’s grievance and disciplinary procedures. It is one area you should be familiar with in case you need to bring your employer’s attention to an unacceptable working condition or, alternatively, if you yourself are subject to disciplinary procedure by the employer. It will clearly state the employer’s procedure, which needs to be followed if any legal action is to be successful in the future.Once you’ve read and signed your contract of employment, make sure that you are issued with your own copy and keep it safe for future reference. Remember that, as with all legal documentation, the Devil’s in the detail. So always take the time to read the small print.