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Archive for February, 2007

Best type of credit card for you

Tuesday, February 27th, 2007

If you are switching to a new credit card, there are some things you should consider if you want to get the best type of credit card that suits you and your spending habits.  By paying attention to the way you spend and the way you pay off your credit card balance you will be able to find a card that is right for you.

If you are a regular spender and always clear your balance in full each month then you should consider a credit card with an interest-free period of 59 days from the date of the transaction.  This way you will be able to avoid paying interest on your card.  A card that offers you a reward or cash back scheme will is another type of card that would be best for you, as you will benefit from the rewards as you will be paying off your balance in full and gaining a bit of a reward for keeping up your payments.  However, be cautious of reward cards as they often have higher interest rates than most cards.  You also want a card that does not charge an annual fee.

If you are a regular spender and usually clear your balance in full each month and occasionally carry a balance forward, a card with a low interest rate and no annual fee would be the best option.  If however, you regularly use your credit card but rarely or never repay the debt in full, the best card for you would be a card with an introductory purchase rate of 0% or a low interest rate.  By switching to a card with a 0% or low introductory rate you will then have a chance to catch up on your payments before the interest charges start.  However, you will want to make sure that the interest rate is not too high as you may not benefit from the card after the introductory period is over.

By researching and finding a card that is best for you, you will be able to enjoy the privileges and conveniences of a credit card.  Keeping a watchful eye on your spending will also help you to know what card is best for you.

Posted in Balance transfer, Borrowing, Consumer Credit, Credit Card, Debt management, Financial products, interest rates, Personal debt, Spending, UK Finance, Zero percent cards | No Comments »

Fraudsters Target UK Consumers

Friday, February 23rd, 2007

The ruthlessness of fraudsters who operate massive scale scams was exposed this week in a report by consumer watchdogs.

Every year criminals rake in £3.5bn from UK consumers.  Behind the statistics live the tragic stories of vulnerable people ruined by scammers who, repeatedly prey on the same victims until they are ruined.  Many people who respond to a scam end up on ‘sucker’s lists’ that are shared by fraudsters.

The Office of Fair Trading published a report that reveals stories of people who lost their entire life savings.

Thisismoney.co.uk reports – In one case a woman wrote: ‘My 82-year-old mother was receiving up to 70 letters a day. I realised last year that she had gone through her entire life savings and was running up considerable debts in the belief that she had won a lot of money.

‘She had given out her personal details including her credit card number to a large number of companies and her credit card was hit repeatedly for small amounts of money which mounted up to £7,000 of debt in a very short space of time’

An MP who contacted the OFT on behalf of a constituent wrote: ‘The sheer volume of communications sent to one address beggars belief. The elderly gentleman was an ex-school head-teacher and clearly of the tradition that such letters should be answered. He spent over £4,000 in one month sending cheques which were demanded by scam letters.’

Recent research commissioned by the OFT involving 11,200 interviews found that every year about 1,388,000 UK consumers fall victim to prize draw and sweepstake scams, 400,000 to bogus holiday clubs, 330,000 to work at home scams, 200,000 to miracle health scams, 170,000 to clairvoyant and psychic scams, 110,000 to loan scams.

Posted in Bad Credit, Borrowing, Consumer Credit, Consumer debt, Credit Card, Financial news, Fraud, Personal debt, Spending, UK Finance | No Comments »

Prepaid Credit Cards

Friday, February 23rd, 2007

If you are looking to take advantage of the convenience of a credit card without risking debt and avoid having to pay interest then you may want to look into getting a prepaid credit card.  A prepaid credit card is just like any other credit card, and is backed by major credit card companies.  The only difference between a prepaid credit card and a regular credit card is that the prepaid credit card is completely controlled by the user.  The account of a prepaid credit card is opened with a deposit and the deposit is then used as the credit limit.  The user of the credit card can deposit as much money as they desire, however only the only amount of money that is in the account can be spent.  If the cardholder goes over the limit, the card will be denied.

There are many advantages of a prepaid credit card.  One of the biggest advantages of a prepaid credit card is the convenience of it, and the fact that there is no way the cardholder can go into debt by using the card.  Because the balance is limited by the amount in the account, you avoid spending more than you can afford.  Prepaid credit cards also carry no interest charges.  They can also help you to build credit, and they can be used wherever a traditional credit card is used.  Many people choose to use prepaid credit cards if they are going on holiday, or during the holiday season when they run the risk of going into debt.

As with any product, there are a few things that you should be aware of when it comes to prepaid credit cards.  Some companies may charge a fee for loading your credit card, as well as charge you for not loading your prepaid card.  There may also be limits on the amount that you can put on the card, as some companies will not allow you to deposit more then a set limit.  Prepaid credit card companies may also require you to keep a required amount on the card as well.  If you shop around and compare what companies have to offer then you can benefit from the advantages of a prepaid credit card.

Posted in Borrowing, Consumer Credit, Consumer debt, Credit Card, Financial products, Spending, UK Finance | No Comments »

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