Before You Borrow…

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Borrowing can be helpful…

At certain stages in your life, you are highly likely to need some form of borrowing e.g. your student loan, a mortgage to buy a home, a loan to buy a car or grow a business.
Managed well, debt can be a useful step in helping you to achieve some important things in life.

….But be careful, poor borrowing decisions can have long lasting consequences:


Never borrow to fund a lifestyle you can’t really afford (e.g. through credit or store cards).  Excess spending now could become a worrying burden for years ahead if you fail to make punctual repayments, resulting in hefty charges and escalating interest costs.


Don’t borrow more to pay off existing debt, because that can lead to money problems spiralling out of control.  If you are getting into difficulty, act quickly to prevent the situation from worsening – talk to your bank or seek free, confidential advice from a debt advice service.
See Financial Support for where to get help.



Don’t take on commercial debt unless you have a guaranteed income to keep up with repayments.
Only ever borrow what you can afford to pay back.



Understand the real costs and choose suitable products

Debt must be selected and managed carefully.
As a potential borrower, you will be faced with a bewildering range of lenders and products – including personal loans, payday loans, overdrafts, credit and store cards.  The wrong choice could prove unnecessarily costly – so be clear about what you need, get independent, professional advice and research various options, so you can make informed decisions with a clear understanding of the immediate and longer-term implications.
The Debt & Borrowing section aims to give you a basic grasp of the real costs of borrowing and types of products available:

Things to Consider
Things to think about before you borrow, to help you choose options best suited to your financial needs and lifestyle


The Total Cost of Borrowing
Understand what factors affect the overall cost of borrowing – to help you work out what you could afford and how you could minimise costs


Managing Debt
How to save money and avoid costs spiralling out of control
Where to get help if you need it


Credit Rating
What it is, why it’s important and how to build a good one


Types of Borrowing
Pros and cons and what to look out for – to help you select the most suitable type of product:
Personal Loans, Overdrafts, Credit,  Payday Loans and Credit Unions


Student Loan  
When and how to repay your loan, and whether to clear your debt early if you have spare cash


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