Tackling your debts

How to avoid extra charges from lenders

Posted 21 August 2017

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Here are the main ways to make sure you avoid extra charges from your lenders.

Struggling with repayments can be bad enough, so you don’t want to find yourself in a situation where you’re getting extra charges from your lenders as well. Here’s how you can avoid this and what to do if you’ve found yourself with extra charges you weren’t expecting.

Always stay in contact with your lenders

The most important thing to remember is that you must stay in contact with your lenders. If you don’t get back to them at all, they could assume you don’t intend to pay what you owe and this could make the situation even worse.

Don’t be worried about speaking to them on the phone. Just explain that you are in financial difficulties and what you intend to do to get back on track. It might be worth speaking to a debt advisor, like the ones here at Debt Advisory Centre, before you do this, so you can explain that you’ve sought advice and have an idea of how you’re going to tackle the problem.

Keep on top of your payments

The best way to make sure you’re not hit with extra charges is to keep on top of your payments. If money is tight, this might be easier said than done, but there are certain things you can do to make this easier for you.

Make a list of everything you’ve got going out and when it goes out. Then make a list of everything that contributes to your income. When you’ve created your budget, you might be able to find ways you can cut back on your spending, that would make keeping up with your repayments easier.

It’s sometimes easier to keep on top of payments when they go out at a certain time in the month. For instance, you might want your payments and bills to go out after you’ve just been paid, rather than at the end of the month. That way you’ll know exactly how much money you have for the rest of the month and you might be less likely to overspend.

And if you’ve got any savings squirreled away, it’s better in the long run for you to put that money towards your debts. This is because the interest you earn on your savings is going to be less than the interest you’re paying on your debts, so if you keep your debts around for longer than you need to, you’ll be losing out financially.

Get debt help

If you know you won’t be able to afford your repayments and you’ve already been hit with extra charges – don’t panic. There’s lots of help out there and you won’t be stuck in this position forever. You can speak to one of our advisors by using the options at the top of the page and find out which debt solution is right for you.

by Christine Walsh

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To find out more about managing your money and getting free debt advice, visit Money Advice Service, an independent service set up to help people manage their money.