The credit crunch that is currently plaguing the UK is going to affect more than just mortgages and loans. The affect has not been too strong yet, but it is believed that the credit crunch will soon be felt by the UK credit card industry as well.
Credit cards are highly prevalent in the UK. According to HoffmanBrinker.com, there are 24.5 million credit card transactions made each day in the UK adding up to £1.45 billion. In 2006 alone, 181 million credit cards were issued in the UK. That equates to roughly four credit cards for each adult in the country.
Credit cards will no doubt remain a staple spending tool for UK consumers, but with the credit crunch holding strong, some consumers may find it harder and harder to find the best credit card for their needs. In addition, it has been common practice in the past to hop from card to card in order to maintain a low interest rate. People that have made this a common practice may find it more difficult to keep doing so in the future.
There are a couple of ways to stay ahead of the credit crunch so that you'll still be able to find the right credit card deal for you. The most important thing you can do is to be aware of your credit history and to be aware of how your spending and borrowing can affect your credit score. Take advantage of offers from companies who offer free credit report viewing so that you know exactly what is on your report at all times. Knowing what is included in your credit history will make it easier for you to know which credit card offers you will be most likely to qualify for.
Another tip to remember is that each credit card application you submit puts a dent in your credit history, so it's best to apply to as few companies as possible. This is why it is important to know the types of offers you will be most qualified for before you start applying to different card companies.
It may also be beneficial to do some research on how to improve your credit score before you start the hunt for the best credit card offer. You may be able to find some tips on types of cards that are beneficial to your credit type and to your financial situation. Below you will find a few tips for those who already know the general status of their credit history as well as their credit card spending and repayment habits.
If you have good credit and you have an outstanding balance on your credit card, you may want to consider transferring your balance to a card with a lower interest rate. Many credit cards offer a 0 per cent balance transfer fee while others may charge up to 3 per cent. This cost is minimal considering the amount of money you will be saving in interest charges by switching to a card with a lower rate.
If you have good credit and you pay the balance on your card each month, a card company with a good loyalty or perk plan might be the best fit for you. Since you pay your balance each month, you will not be subject to any interest charges, and you will be earning points toward travel or other types of rewards, or you could be earning cash back.
If you have adverse or bad credit, there are cards available for you as well. As with getting a mortgage or a loan with an adverse credit history, you will have to pay a higher interest rate than you would if you had good credit, but if you manage your spending and repayments well, the interest rate should be of little or no consequence.
To find the best credit card offer for you, check out our credit card comparison table. If you'd like help managing your current credit card debt or if you are interested in speaking with a debt specialist to find out how to improve your credit score and eliminate your debt, take a moment to fill out our short debt form, and SimplyFinance will match you with a debt specialist or a debt manager that will work with you to help you get where you need to be with your finances. This matching service is free, and you are under no obligation to accept the offers of our debt management or debt specialist providers.