Don't get bitten by a loan shark this Christmas
As the Christmas shopping season gets underway Hackney Council is asking people to think again before borrowing money.
Residents are being encouraged to be 'debt smart’ this Christmas to avoid debt spiralling out of control.
Be debt smart- compare deals before committing to borrow and always read the small print. Ask any lender to explain the total cost of paying back the money borrowed, including any hidden charges. Residents will soon be able pick up a leaflet from Council buildings or visit the Councils website.
Be debt Smart- speak to London Community Credit Union as they offer savings and loans. They often agree to smaller loans than most high-street banks and are a much cheaper alternative to pay day loans.
- Illegal money lenders have been known to charge up 3,000 per cent interest. A £400 loan taken out to buy Christmas presents could cost up to £1,000 a month.
- £400 of Christmas presents and food bought on a ‘bad credit’ credit card charging 49.9% interest would cost £763.
- A high street store offering 69.9% interest on a £400 fridge bought for Christmas would cost £726.
- The credit union charges a typical 12.7% interest. Borrowing £400 for Christmas shopping would cost a total of £438.
We know many residents are struggling to make ends meet, and there are times such as Christmas when people feel they need to borrow money. We want residents to better understand the true cost of borrowing and to consider all the options available to avoid getting into too much debt.
Hackney Homes tenants with a clear rent account on 10 January will be entered in a prize draw to win a month’s free rent.
To avoid unnecessary debt it’s important that tenants let the Council know of any changes in circumstances that might affect their housing benefit.
Anyone experiencing any financial problems can talk to Hackney Citizen’s Advice Bureau on 0844 499 1195 Monday, Tuesday and Wednesday from 1.00pm to 3.00pm.
Residents can use The Money Advice Service’s online budget planner at www.moneyadvicservice.org.uk to help plan their finances,
Anyone that has been bitten by a loan shark can contact the Illegal Money Lending Team on 0300 555 2222.