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Credit card holders are being stung by their issuers, as comparison website Moneysupermarket reveal that the APR (annual percentage rate) has gone up on nearly a third of all credit cards in the past 12 months.

The main culprits who have upped the APR for their existing customers are Egg, Capital One, Lloyds TSB, MBNA and Barclaycard. Egg have upped the APR for 11% of their cardholders. More worryingly, 27% of cardholders were unaware whether their APR had increased on their credit cards, meaning that more need help to manage debt to ensure that their finances do not spiral out of control.

Head of credit cards at Moneysupermarket, Steve Willey said: “Firms writing to customers telling them their APR is about to increase will only exacerbate the debt problem in this country.. Increasing the interest on purchases will only make those rising food, fuel and mortgage bills harder to pay, and lengthen the time it takes people to clear their debts.”

If you are struggling to clear your debt as you find your credit card payments unaffordable, give One Advice a call on 0800 048 1752. Our expert debt advisors will help you to go through your finances to find a debt solution which will make your credit card payments much more affordable.

Are you struggling with your credit card debt? If so, then you are not the only one. More people are finding that their credit card debt is harder to repay, and recent figures from the International Monetary Fund predict that 7% of all personal debt in Europe (totalling $2,467 billion) will be defaulted on.

Many of these defaults will be in the UK, as it is the largest nation of credit card debt borrowers besides the U.S. Coupled with a fluctuating house market, rise in unemployment and banks becoming more strict about who they offer secured lending to, many people are turning to credit cards and unsecured loans.

Author of the report,  Charles Geisst, who has investigated American credit card debt, says the average American has 13 credit cards and each. “Unemployment is the straw that will break the camel’s back. The default rates already are twice what they used to be. I think it’ll get worse.”

If your credit card debt is harder to repay, there could be a solution for you. A Debt Management Plan makes your credit card debt easier to repay by reducing the monthly credit card debt repayment that you need to make. Contact us now for further help with your credit card debt.

Over the past year, almost two million Brits have ‘cut’ credit card debt, quite literally, by cutting up their credit cards in order to avoid getting into unaffordable debt with their credit card provider.

Apparently 6% of the £52 billion credit-card market has taken the initiative to cut up their plastic credit cards to avoid temptation and sinking into financial trouble during the credit crunch. uSwitch also believe that a further 10 million have stopped using their credit cards but keep them in case of a financial emergency.

7% of us are estimated to have between five and six unused credit cards which have a combined credit limit of £200bn.

If you are looking to cut the amount that you are paying to your credit cards each month, One Advice could help. We could be able to offer you a debt management plan which allows you to reduce the amount of debt that you need to pay on a monthly basis. Call us now for further information.

Credit cards debt are one of the most common causes of UK debt problems. As a country, Britain has more credit card borrowers than any other European country. Credit card debt is a growing problem, both in the UK and across the globe. There are a number of reason why it is easy to fall victim to mounting UK credit card debts:
* Multiple credit cards making it easy to spend money that you have not got.
* Missed payments lead to additional charges.
* High interest rates coupled with a low minimum repayment required.
* Lack of consumer knowledge when it comes to the consequences of the end of promotional introductory offers.

UK Credit Card Debts Advice

Knowing that you are struggling with UK credit card debts is the first wake-up call that needs to happen, as this allows you to come up with a plan to seek debt advice or start to repay your debt.

Budgeting: One of the first steps that you need to take when tackling mounting UK credit cards debts is budgeting. Devising a budget planner can help you work out how much money you have available for repaying debt after you have accounted for essential living costs and bills.

Work out where you can cut back on frivolous spending. Successfully learning how to cut back means that you can prioritise repaying your UK credit card debts or other unsecured debt. You may want to pay off the one with the highest interest rate firsts so you don’t build up unnecessary credit card debt.

One of the ways which you can ensure that you won’t be stung with charges from your credit card providers is to set up a direct debit to ensure that at least the minimum amount of your debt is paid.

Getting Debt Advice about your UK Credit Card Debts: Sometimes a simple budget plan is not a drastic enough solution to help you repay your debts. Perhaps even the minimum amount of debt is too high to pay once you have taken into account all of your living expenses and secured debt repayments. (more…)

Confused.com are advising credit card holders to treat their credit card debt as a priority debt and ensure that it gets paid off as quickly as possible. This is because credit card debt is often the most expensive form of personal debt, meaning that it often  incurs the highest rate of interest in comparison to other forms of debt.

The comparison website recommends that you switch to a cheaper credit card and ensure that you make more than the minimum payment each month so that your credit card debt shows signs of decreasing. Taking control of your debt management and making more than the minimum payment to your credit card debts are cited at top tips by the website.

It would take someone with a credit card balance of £5,000 at an interest rate of 14.9% 36 years to clear off their credit card debt if they only paid the minimum payment. During this time they will have racked up £7,000 worth of interest. By paying an extra £50 per month towards this credit card debt, the repayment time would be slashed to 6 years with less than £2,000 worth of interest debt being added.

Joanne Garcia, head of credit cards at the site, said: “If you can’t switch to a cheaper credit card, you can still make staggering overall savings by making more than the minimum repayment every month.” It is not possibly for everyone to switch credit cards in order to benefit from a lower interest rate; the main reason being that a low credit score combined with the credit crunch means that credit card lenders are a little more wary about new credit card debt applicants.

UK Credit card debt management is a problem for 4.8million people who have experienced increases in the amount of money they owe to their credit card debt, according to Tesco Compare.

The outstanding credit card debt balance has increased by an average of £412, meaning that more people are worried about getting their UK credit card debt management into check. However, it seems that the idea of being free from credit card debt is seeming more impossible for some, as 11% of those polled admitted that they would be incapable of handling their finances without the use of credit cards.

However, it is not all doom and gloom when it comes to UK credit card debt management. The research also found that nearly half of credit card users are cutting their credit card spending by £100 a month. Many are cutting back on their credit card spending in a bid to reduce their debt levels and increase their savings. (more…)

Do you have five or more credit cards?

More than 3m Brits do, with many spending way beyond their means and facing unpayable monthly bills. Typically the worst serial credit card offenders are those between 35 – 44 years old. Many are willing to freely admit that they were at breaking point with their finances, as they try to juggle multiple debt on multiple cards.

Credit Cards should only be used as an emergency backup and you should not ‘live’ on your cards. This will only lead to more debt, and high-interest repayments. One Advice believes that it is important that you get this type of spending under control as soon as possible. If you find that you need to pay your credit card bills with another credit card, or you regularly draw out cash as a means of living – you need expert help.

Credit Card Help is Available

There are ways to relieve the burden of debt and pressure from creditors who are demanding you to pay what you simply can’t afford. You might want to think about a Debt Management Plan which is suitable for those with multiple debts. One Advice can negotiate with creditors and find you a lower monthly payment, leaving you with more money in your pocket.

If you are facing debt over £15,000 then you might want to consider an IVA, this is Government legislation designed to reduce your debt. Contact One Advice today on 0800 048 1752.

This is the second guest post by Mr Credit Card from www.askmrcreditcard.com. As the name of his site implies, Mr Credit Card reviews lots of credit cards. You can apply for a credit card at his site. (By the Way – the site and the following article is US based. Before taking on board any advice which you come across on the Internet you should always make sure that it is tailored to your country of residence as policies do vary).

Establishing credit in the US is kind of a funny business. This country is so credit dependent that a lot of people’s finances revolves around having a good credit score. There are three credit bureaus in the US – Experian, TransUnion and Equifax. To actually get a good credit score, you actually need to have credit! If you are a pay everything in cash person (which is actually being prudent), you will not get a score as high as you could. And that will impact things like the rates you get for your mortgage, car loans etc.

There are several ways to establish credit card in the US. You simply have to take out loans. If you buy a house and get a mortgage, your mortgage payments get reported to the credit bureaus. Consistent timely payments over time will allow an individual to rebuild a good credit. The same thing happens when you take an auto loan or a secured or unsecured loan from a bank. Your timely payments will contribute positively to your credit score.

The only problem with getting a mortgage or auto loan before you establish a credit history is that you will pay a higher interest than necessary. So what is the best way of establishing a credit history? Answer – get a credit card.

Yes, that is right. Getting a credit card is the fastest way to establishing a credit history. But what type of credit card to get? There are a couple of alternatives to consider. (more…)

Many High Street shops offer their own store credit cards, and many cashiers will tempt you to sign up with a juicy introductory rate or money off your purchase. But are store credit cards worth it, or would you be best off making the purchase on your normal credit card?

Store credit cards work in the same way as a credit card, as you use the credit (although it is important to remember that credit is always debt) to make the purchase and then you pay the debt back when the bill arrives, either in monthly instalments or by paying off the store credit card balance in full.

A store credit card is more limiting than a normal credit card as you will only be able to use the card in certain shops or a certain chain of shops. But the main disadvantage of a store credit card is the interest rate which is applied to the purchase if you choose to spread your repayments, as these are often much higher than normal credit card rates. This means that you could be very careful when applying for a store credit card, think about if you can afford to pay off the purchase when the bill arrives or if you would be better off to put it on your credit card or, and best yet, choose to wait until you can afford the item and pay for it with cash.

Store credit cards can offer you advantages over a credit card, if they are used wisely. For example, you will be able to benefit from discount off the item you are going to buy. Many retailers will also often certain perks which are exclusive to card holders, such as money-off events or free postage and packaging if you buy something from their website. But you need to way up the perks and implications of a store credit card and decide if it is right for you.

Never agree to a store credit card just because you are feeling pressured by the cashier, especially if you have a bad credit rating. You could be declined for the card which is not only embarrassing for you but could end up damaging your credit rating even further.

In comparison to paying with a credit card or with cash, store credit cards offer very little perks. They are only a good idea if you can realistically afford to repay your balance in full so that you do not have to pay the extortionate level of interest.

Pay off debt quicker by increasing your direct debit payment to just a small percentage more than the minimum payment and be amazed at the difference it could make. Comparison website moneysupermarket.com are urging those with credit card debt to increase their direct debit payments in order to pay off debt quicker.

The site gave the example of a consumer who owes £1,000 on a 16.9 % APR credit card. When making a 2% minimum payment, the consumer earns £151.74 in interest and only reduces the credit card debt down to £920.60. Whereas someone who paid 10% would pay off the debt in just 12 months, and almost half the amount of interest acquired (£79.16).

Thus showing how just a small increase in the monthly direct debit payment can really make a difference when it come to paying off your debt.

Peter Harrison, credit card expert at the site, said: “If you opt to increase your repayment amounts you will reduce your debt and the interest paid significantly. Even if you are with one of the few lenders that won’t allow you to set you direct debit higher than the minimum repayment, you can set up a standing order at a larger monthly amount.”

The credit crunch means that more of us are being hit with the relisation that our income may not able to cover all of our outstanding debts. Whether this is a long term problem or something short term because of unexpected expenses, it is important that you seek help and be careful not to make any financial errors which could land you with more credit card debt in the long-term.

Be in control.
The best way to ensure that your credit card debt is affordable is to be on top of your financial situation. If you keep your records up to date, you should be able to budget better and ensure that you can afford to meet at least the minimum payment.

Can you budget better to afford your credit card debt?
If your problems are short-term then it could be best to go without for a couple of weeks so you do not fall behind with your credit card debt repayments. For example, eat in instead of going out for meals and use this extra cash to pay your credit card debt.

You could even try and sell some things online, such as old clothes that you’ll never wear or DVDs that you’ll never watch again. This can be a great way of raising some additional cash as well as clearing out your house of items you no longer require.

Get in touch with your creditors.
Although the first thing that you’ll want to do when you realise you can’t afford your credit card debt is to hide away from your creditors, it could be worthwhile getting in touch. Contact them before your credit card bill is due to be paid and explain the situation, you could be very surprised with their level of helpfulness.

Get help to deal with credit card debt.
If your credit card debt is more of a long-term issue, or you have problems repaying other forms of unsecured debt such as store cards or unsecured loans, then you now could be the best time to seek debt advice.

One Advice offer a full range of financial solutions from debt management plans to bankruptcy or IVA – no matter what your level of credit card debt there is a debt solution designed to help you. Call today for free debt advice on 0800 048 1752.

Does it feel as though you are caught in a trap of credit card debt? And no matter what credit card debt repayments you make, your balance seems to go down?

You could be  a victim of the credit card debt trap thanks to the ‘negative order of payment’ method employed by many credit card lenders.

The ‘negative order of payment’ trick means that credit card lenders allocate any credit card debt repayments towards clearing your cheapest credit card debts first (those accumulating the least interest, which you might have acquired through a promotional balance transfer), and leaves your most expensive credit card debts (those accumulating the most interest, such as cash withdrawals) trapped on your credit card. This means your most expensive debt will be attracting extra interest until the cheapest debt has been paid off.

This method is used by many credit card lenders, meaning that your credit card debt may cost you more than you originally thought. For example, if you are benefiting from a 0% balance transfer but still had credit card debt on the card beforehand, you will be making the repayments towards you cheapest transaction.

So, are you a victim of the credit card debt trap? If you are unsure whether your credit card provider uses the negative order of payment method, you can check your latest credit card statement. By law, your credit card provider is obliged to make this information available.

Make sure that you read through the Terms and Conditions of your credit card closely. It should offer you more information about how your payments are prioritised.

“How can I avoid the credit card debt trap?”: The only way this can really be avoided is to make sure that you do not use your credit card for cash advances and that you pay off your credit card debt in full on a monthly basis. This means that you will not have to pay interest on your credit card debt.

If you are struggling with your credit card debt and it is unaffordable to you, there is credit card debt help available. One Advice are leading financial solutions experts. We could make your monthly credit card debt payments more affordable to you. If you want to see if you can benefit from a reduced monthly payment through a financial management plan, please get in touch. Our advisors are on hand to offer you the latest debt advice, call now on 0800 048 1752.

Although this may seem like an obvious statement for most, credit card debt should be avoided as we are urged to not “fall back” on credit cards if we are unable to get our loan application accepted in the current economic climate.

The recommendation is to avoid credit card debt all together by living below our means. This is timely advice as the number of unemployed in the UK is expected to increase throughout 2009.

However it seems that more of us than ever are juggling more and more credit card debt, as research by Apacs found that credit card spending increased by 2% in 2008 and reached a total of £126.2 billion.

About avoiding credit card debt, David Kuo, head of personal finance at fool.co.uk, said: “People need to be very aware that there is a problem with the economy at the moment, there is a problem with the system.”