It can be tricky staying on top of your loan repayments, but if you’re looking to improve your credit score and ensure you have access to the right financial products now and in the future, it’s important to manage them properly.
At Oakam we want to help you manage your loan repayments effectively, so we’ve put together some top tips to help you do just that.
Request a breakdown of your loan
First things first, it’s important to know exactly how much you owe and what your repayment schedule is. You can ask your loan provider – whether they’re a digital lender, a doorstep lender, or any other loan organisation – for a breakdown of your loan, which will provide this information for you.
This makes it easy to get a handle on the details of your loan, so you know where to begin.
In the Oakam app, you can view your repayment schedule and next repayment amount easily, at the click of a button.
Take advantage of automated payments
Automated payments such as standing orders and direct debits should be your best friend. They take all the hassle out of sending payments, and once you’ve set them up you can put them to the back of your mind until you no longer need them. They’re also particularly handy if you’re liable to forget when a payment is due, meaning that you’ll never miss a payment again!
It’s advisable to set up your loan repayments so they leave your account shortly after you receive your income, to be sure that you’ll always have sufficient funds available. At Oakam you can easily change the time of day when your repayment is taken in our handy mobile app.
Boost your savings after you’ve made your repayment
We know it can feel tempting to take a chunk of your earnings and put it into savings straight away, and while this might feel like a productive thing to do, it might not be your best choice if you’re also paying off a loan.
Having the safety net of savings is always a good idea, but make sure that you have enough to pay your loan repayment before you put something away for a rainy day. The sooner you pay off your loan, the better, so while it might not feel as good to be spending this money rather than saving it, it’ll be worth it in the long run.
Communicate if you’re struggling
On the whole, your lender is looking to help you, not penalise you. So, if you’re struggling with your finances and you know that you’re not going to be able to make a repayment deadline, the best thing you can do is to communicate this with them. Then, instead of letting the problem fester and get worse, you can face it head on and come to a solution that works for both you and the loan organisation.
We work with our customers to find flexible repayment solutions that help you repay your loan in a way that is best for you.
Failing to let your lender know that you’re struggling with your repayments could result in excess fees and late charges (although at Oakam we never charge late fees!), which will make it harder for you to pay off your loan in the long run, and will cause loan companies to look at you less favourably as a customer in the future.
Managing your loan repayments takes some planning to ensure that your loan doesn’t start to control you, rather than you it, but once you know where to start it can be pretty straightforward. Taking small, regular actions can add up to have a big impact. Our suggestions are just a start, but we hope that they help you begin your journey to taking control of your loan.
Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk. To get debt advice information, we advise seeking independent advice from an impartial service like Citizens Advice or a qualified Financial Advisor.