Advice Services


It’s always best to save money to purchase what you need.

Sometimes, you may be unable to purchase what you need from your savings, and you may have to borrow. There are always costs associated with borrowing so it’s important to plan and manage these cost to ensure that they are affordable and necessary.

Remember that your credit rating may be negatively affected and you may experience more financial difficulties and debt if you are unable to repay what you borrow.

Where can I borrow money?

Bank or building society

Many people borrow money from a bank or building society, either by accessing a personal loan, overdraft or credit card.

Credit Unions

Some credit unions provide cheap alternative loans just like a bank or building society. Visit the Find Your Credit Union website to find your local credit union and the service it provides.

Friends and family

You may be able to borrow money from family and friends in an emergency but it may damage your relationship although you avoid bank charges and fees.

What to check before I borrow?

Total credit to be repaid

Add together your loan or credit amount, interest and other charges which you must pay. The Annual PR tells the true cost the interest that you will pay for your credit.

Payment date

Is the payment date suitable for you? Will you have money available to pay when your loan or credit payment is due? If you don’t then you may be charged with a penalty fee.

Terms and conditions

Read and understand the fine print which explains your rights, responsibilities, payments, fees and duration of the loan.

Early repayment fees

Avoid credit with early repayment fees if you are likely to repay your credit in full before full payment is due.

Check your credit rating

Apply for credit that suits your credit rating.


Are there any alternative lending streams, for example peer to peer lending? For further information visit the Money Advice Service website.


Is this credit affordable? Ensure that you are able to repay what you borrow as your credit rating may be negatively affected if you do not repay what you owe.

Your credit limit and interest

The amount that you can borrow depends on your personal circumstances, credit rating and level of debt. You may be charged a more expensive interest rate if you have a low credit rating and a high level of debt.

Alternative borrowing options

Payday loans

Payday loans allow quick access to credit but interest rates are usually much higher than those charged by banks, building societies or credit unions. Some borrowers experience difficulty in repaying payday loans and experience even more debt and money management problems.

Logbook loans

You may be able to get credit if you use your vehicle as security. This is called a logbook loan.

In order to obtain a logbook loan, you must transfer ownership of your vehicle to the lender by signing a bill of sale and surrendering the logbook.

You will be able to continue using your vehicle as long as you pay your loan instalments.

Illegal lenders (loan sharks)

Persons who lend money but are not authorised to act as a money lender.

People and organisations that lend money must obtain a licence from the Financial Conduct Authority. It’s best to borrow money from an organisation or person that has a licence because they must follow good financial practices and industry rules.

An illegal money lender does not follow these rules and may use violence and intimidation when you can not repay what you owe.

Interest rates are also very high, so you may get into more financial difficulty if you borrow money from an illegal money lender.

If you have already borrowed money from an illegal money lender call 0300 552 2222 for help.

Doorstep lenders

A doorstep lender visits your home to organise a loan and to collect payment. Interest rates are usually much higher than what you would pay if you borrowed money from a bank, building society or credit union.

Check for cheaper options if you are considering borrowing money from a doorstep lender and always ensure that your lender has an FCA licence.


A pawnbroker will lend money to you as long as you leave a valuable item as security. The contract that you sign will state how much money you must repay along with interest, when your item will be returned to you and what would happen if you do not repay the loan.

Your valuable item is likely to be sold if you are unable to repay your loan.