Bad Financial Habits Sending Aussies Broke

July 8, 2021
, , , Budgeting

One-third of Aussies admit bad financial habits such as not knowing how to budget, using cash advances on credit cards, racking up late fees on credit facilities, and not paying attention to debt are the reasons for their personal debt situation.

People who experience money problems and chronic debt often share similar behaviours and financial habits. By watching out for the following bad habit behaviours, based on research by Lonergan Research, you might be able to adjust and reassess your approach to debt.

Impulse & Lifestyle Buying

Fact: 54% of Australians say that big-ticket purchases such as a holiday, homewares/furniture, and education costs contribute to their debt.

Some of these purchases are necessary, or they drastically improve your quality of life, but others are pure impulse. Impulse buying occurs when you purchase something you weren’t planning to. It can be as small as a candy bar in the checkout line or as big as walking into a car dealership and walking out with a brand-new car. If it’s a purchase that’s not planned ahead of time, it’s an impulse.

Emotions can affect your decision on what to buy. Maybe it’s nothing extreme, you tell yourself it’s no big deal, you just want something nice for yourself to feel better. But how many times are you telling yourself that?

Try to create a budget that you actually stick to. A budget won’t make all of your money suddenly behave. It’s for you to decide where your money goes each month and then follow through with the plan. If you absolutely need to make a few minor impulse purchases, budget them in too! Just make sure to keep that portion of the budget contained and don’t let it get too big.

If it’s not in a budget, don’t spend the money. It’s that simple. You can do it!

Everyday Addiction

Food delivery costs Australians a larget part of their budget

Fact: 44% of Australians say that everyday purchases such as take away food, eating out, and Uber Eats contribute to their debt.

The little purchases can add up, and at the end of the month, you can be facing severe buyer’s remorse and a dwindling bank account.

Figuring out what items to buy and how much you’ll spend on it really helps. You will less likely give into overspending with a plan in place.

Most consumers start by tracking the much bigger expenses, which is a great beginning. It’s also important to pay attention to those small daily purchases. Those morning coffees, lunches out, lottery tickets, or magazines from the grocery checkout line can really add up more than you think they would, and they affect your budget in a big way.

Tracking your expenses is vital as it makes you accountable for every time you spend. When you are aware of where your money goes, you can make smarter spending decisions and identify the areas you can cut back in. Use a budget tracking app or build yourself a spreadsheet—use the method that works best for you!

Debt Is Out of Sight Out of Mind

Fact: 31% of Australians say that poor management such as not knowing how to budget, not paying attention to debt, or raking up late fees and cash advances contributes to their debt.

When you tune out during debt conversations, you develop risky habits that could put you in a worse situation. People who tend to ignore their debt may engage in wilfully ignorant behaviour. Ripping up bills and statements before opening them, avoiding phone calls from collection agencies, and becoming defensive when debt is discussed. They often don’t even know how much debt they owe.

Taking an “out of sight, out of mind” attitude towards what you owe is dangerous, and it only encourages those bad habits. You don’t have to like it, but you do have to acknowledge your debt.

Get in the habit of readily and calmly opening any bills. The more you are familiar with it, the more informed you are about it, the better prepared you can be to face your debt.

Once you figured out how much you owe, work out your payment plans. If you owe a lot to various creditors, pay your fixed bills and utility first. Then focus on the one with the smallest balance. This way is more achievable, and paying off the last balance can motivate you to move onto the next one.

Credit Mismanagement

Managing credit cards and credit spending is important

Fact: 48% of Australians say that debt is at least partially due to mismanaged and maxed out credit cards, going over spending limits, frequently making purchases with AfterPay and other BNPL services, or making purchases late at night in an attempt to rort the credit card approval system.

The problem with overspending, in particular with credit cards, is that it leads to owing more money back, and that will only hurt your credit score. It makes paying off your balance harder and more expensive, getting you into debt. The good news is for most people, you are in control of your credit card spending, which means you can avoid overspending with the proper guidance.

 

Set your own credit card spending limit. Allow yourself to spend a certain amount each month, based on your income and standard expenses.  Monitor your credit card balance and make sure you’re not exceeding your limit. Ask your credit card issuer to lower your credit limit if it will help you keep your credit card spending in check.

Do not think of your credit card as free money. Remember that you will have to repay whatever you borrowed. Hold yourself accountable for your credit card spending and treat it as if you were actually using cash.

If you liked our “Bad Financial Habits Sending Aussies Broke” and took away some valuable information, check our blog space regularly for more budgeting tips and tricks and other useful resources on your finances.

Determine what your chances are to get a loan

Determine What Your Chances Are To Get A Loan

January 9, 2019
, Bad Credit Loans 9

Say you need cash at hand because you are going through a financial emergency. Say you are planning to get a loan but have a bad credit. We know that trying to acquire a loan with bad credit can be a challenge, especially when it shows on your credit file. There are different loan options you can still consider. This is where bad credit loans can be applied.

Can I be approved of bad credit loans?

There is no sure way to get approved. Although there are a few pointers you can use for a better chance at bad credit loans.

You can check where you stand by examining your credit score. The higher the score is, the lesser the risk of defaulting. Your credit score can be checked in your credit report for free by using the national credit reporting bodies (CRBs) / credit bureaus listed on the Australian government website. Information such as loans acquired and applied for, as well as personal information (name, address, etc.) are also detailed in the credit report. *Note: your credit score differs depending on the credit bureau.

Bankruptcy, Part IX debt agreements, and defaults are indicators that will place you in the bad credit category. Lenders can also look at late loan repayments, late bill payments, exceeding credit card limits, and multiple loan applications as warning signs that you have bad credit. How bad your credit depends on the lender so make sure to make some enquiries or call their hotline to find out.

If you have applied for a loan before, you are well aware that multiple applications at once is frowned upon. Lenders view it as a red flag and might cause refusal to accredit future access to funds. If this is the case, wait for a while before making another application.

Use a loan calculator to ensure that you’re not applying for a loan that you can’t afford. Most lenders have their own calculator on their websites, set the loan amount and term to have an idea of how much you are going to repay.

Find the right lender for your bad credit loan

Nowadays, there are many specialist lenders to choose from. You may not know where to look first, but it’s very important to do your research and find the right one that suits your financial situation. Here are the following things to consider:

  • Do your research — Make sure your specialist lender is dependable and have a good reputation because they will access your bank account details, among other personal information. Visit the lender’s website to learn about the terms and policies. Do not hesitate to make enquiries and ask about details you deem important.
  • Rates and fees — For faster access to funds and special features from non-traditional lenders, expect to have higher interest rates and fees that come with bad credit loans. Lenders can charge up to 24% of the principal loan amount as monthly fee for a loan less than $2,000, as monitored by The Australian Securities and Investments Commission (ASIC).
  • Turnaround time — Assuming you need the cash urgently, it is better to look for a lender that can make fast decision and credit the the funds directly to your account within 1 to 24 hours. Cigno Loans offers products that won’t make you wait for days or weeks. Check it’s website to learn about your options.
  • Loan extensions — This may include extra fees, but some specialist lenders can extend your loan term up to 90 days. Make sure to enquire on details in the event of a default. Ask about hidden and extra fees you may need to pay in your loan terms. Try to avoid any extensions if you want to pay off your loan quickly.
Determine what your chances are to get a loan

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Although lenders can tailor-made it’s services to help you, it is wise to only get a loan when you really need them. If you already made a list of possible lenders to choose from, make sure to call them up and make enquiries to assess the right one for you. Remember to apply for a bad credit loan only when you are positive that you will be approved as every application will show up in your credit file.

Read the terms and conditions thoroughly to know the commitment you will lock yourself into. It is also advisable to work towards making your credit score better for future loans.

Loan agreement on a table and dollars.

Why No Credit Check Loans are Your Solution to Unexpected Expenses

April 1, 2018
, , Bad Credit Loans 11

Nearly 1 out of every 5 Australians would struggle to come up with $500-$1000 to cover an emergency expense.

That means when a tyre pops, an injury occurs, or a roof needs repair, almost 20% of the country is left scratching their head, wondering what to do.

For many people, the solution to this problem is obtaining a loan. Loans can be an easy way to get past an emergency financial stumble between paychecks and are relatively easy to get at any financial institution… for people with good credit.

Life throws curveballs at you, and you’re not always able to afford them. Fortunately, no credit check loans can help you during these times. Here’s why.

But How Can You Get the Help You Need If Your Credit Is Average or Poor?

If you’re one of the millions of people around the world struggling with credit issues and need access to temporary financial support to get through a difficult time, no credit check loans could be the solution you’re looking for.

What Are No Credit Check Loans?

No credit check loans, as their name suggests, is money you can borrow from a loan provider without the need to have your credit checked. Loan amounts vary from provider to provider but on average can range from $50.00 to over $1000.00.

Approval is based mostly on verifiable income, the application process is non-invasive and you can have the money you need fast.

If any of the following apply to you, you may want to consider getting a loan that does not require a credit check:

  • You have a poor credit history
  • You have no established credit history
  • You need quick access to fund an emergency expense (car repairs, home repairs, health expenses, etc.)
  • You want to apply for a loan that specialises in helping applicants with below excellent credit

Why Choose a No Credit Check Loan over a Traditional Loan?

While loans without credit checks are generally associated with customers that have below average credit, know that even people with excellent credit may opt for this type of loan for a variety of reasons.

Traditional loans tend to require large amounts of paperwork and paperwork means progressing time. No credit check loans generally process faster since less information needs to be verified to get your loan funded.

Also, getting your credit checked may hurt your credit score.

There is a lot of varying information on this topic, but the key to understanding which kinds of checks harm and don’t harm your credit score depends on the type of credit check being conducted.

There are two types of credit check inquiries, hard and soft.

An example of a soft credit check is when you use an online service to look at your own credit score. This type of check should not affect your credit.

Hard credit inquiries (or hard pulls) are the type of credit checks that are generally required by lending institutions. With a hard check, lenders request a more in-depth look at your credit history to determine whether or not you are eligible for the loan they are offering

Hard inquiries can damage your credit score between 5 and 10 points which can be a big difference to borrowers.

For that reason, many people, regardless of the type of credit they have, may opt for no credit check loans.

Why Do Lenders Offer Loans Without Credit Checks?

Large amounts of prospective customers looking for loan products, through no fault of their own, have poor or no established credit. The reasons why people have poor or no credit vary and taking the time to understand those various reasons is why no credit check loan options are a safe bet for lenders.

For example, not having credit history can be a result of your age. Somebody who is going to college for the first time and needs extra cash to pay for moving expenses should have options to attain the money they need to get to where they need to go.

The same goes for people with poor credit. Many people have temporary lapses in employment which results in unpaid bills that can damage their credit. This temporary hardship is not an indicator of their willingness to pay back their loans in the future and therefore, they don’t represent a significant risk to lenders.

Considering those two things:

  1. The number of prospective customers with less than excellent credit
  2. The low pay-back risk many of them pose since their credit issues were out of their control

is why lenders have developed loan options that are mutually beneficial to both them and borrowers in the form of no credit check loans.

What You Need to Get a No Credit Check Loan

Requirements vary from lender to lender but generally, all you’ll need to qualify are:

  • Verifiable income
  • An active bank account
  • And be of legal age to take out a loan

To Sum It Up

If you’re in need of fast cash for life’s unexpected occurrences but are worried that your credit history will stop you from getting the help you need, no credit check loans can help.

Loans that do not require credit checks are a safe means of getting the money you need and rely almost solely on your verifiable income for qualification. Credit is not a factor and will not be checked during the application process.

Why You Should Apply for No Credit Check Loans

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How We Can Help

At Cigno Loans, we offer no credit check loans that are tailor-made for your particular financial needs. We believe in responsible borrowing and lending and to that end, one of our loan advisors can guide you through taking out a loan that fits your lifestyle and gives the help you’re looking for.

We help people through tough financial situations every day. We fully understand the pressure they’re under, and after we’ve given them the help they need, they come to find that our team is more understanding than other lending institutions.

Remember, we’re here for you every step of the way. If you ever need help with any of your lending-related questions, let us know!

If you’re interested in a loan that won’t check your credit and offers competitive rates, you can apply today!

Read more about loan advice, money saving tips, and finance on our blog!

Business Man Pointing the Text: Bad Credit? We Can Help!

Bad Credit Loans: It’s Still Possible to Get a Loan, Even if You Have Bad Credit

November 29, 2017
, , Bad Credit Loans 17

Do you find yourself unable to get ahead?

No matter how you manage your money, how much you save or how many extra shifts you take, you just can’t seem to get a break?

Finances seem to work in cycles: if you are in a good place, you can use that to make investments and wise purchases.

If you find yourself in a bad place, it seems there are few options that don’t put you further behind.

Sometimes all you need is a loan to gain an advantage. While it probably isn’t enough to pay off your debts, it can be what you need to get started.

But how do you even qualify for a loan with bad credit?

Below we’ll look at the advantages and disadvantages of a bad credit loan, and what options you have.

What Is A Bad Credit Loan?

What is a bad credit loan, anyway?

A conventional loan is usually tied to your credit score. By having proven your ability to make smart financial choices, the lender will offer an amount of money at a set interest rate. Having a high credit score usually results in a lower interest rate.

These loans are generally high-dollar value and can be long-term.

Bad credit loans, on the other hand, are for people who can’t count on their credit score to provide them with a loan.

What Causes Bad Credit

Having a bad credit rating can make it very difficult to gain financial advantages. Things that can cause someone to have a poor credit rating are as follows:

  • Late payments
  • Failure to pay
  • Owing collections agencies
  • Filing bankruptcy
  • Foreclosure

What the above all have in common is the failure to satisfy a financial agreement. Whether it’s the failure to pay off a credit card or letting a phone bill go to collections, accepting money, products or services without paying them back will hurt your credit score.

How Bad Credit Loans Can Help

There are two major ways a bad credit loan can help improve a difficult financial situation.

The first helps manage the short-term stress of being in a difficult situation while the second can actually help you turn things around for the long-term.

Get Some Breathing Room

One of the most difficult things about having money problems is feeling trapped. It can be overwhelming to be unable to meet your needs when money seems to go quicker than it appears.

A bad credit loan can help give you a boost. By receiving a lump sum payment, you can often get a handle on the most immediate concerns.

Being free from those pressing issues can give you the breathing room you need. Take it and make a plan for how to keep moving forward.

Better Your Rating

Believe it or not, but that bad credit loan can actually be your key to improving your credit score.

By borrowing money and paying it back on time, you’re actually demonstrating your ability to be financially responsible. Taking out one loan and paying it back won’t immediately improve your situation, but it helps. Most importantly, it puts you on the right track to make real and meaningful improvements.

Where to Find Help

People with poor credit ratings are often too risky for the big financial institutions.

This can lead you to a number of smaller organizations that offer smaller, shorter-term loans that aren’t dependent on your credit rating.

There are things to be careful of, though.

As people in this situation can be quite desperate, there are businesses out there designed to take advantage of that desperation.

Taking a loan without properly understanding the terms can actually have a much worse impact on your situation, regardless of what temporary relief it may offer.

Especially with the rise of the internet, it’s never been easier for scam agencies to target those in need.

Some things to look out for are:

  • Upfront fees
  • Collateral
  • Unregistered business
  • No physical address
  • Spam emails

Any agency that deals with bad credit loans should have protocols in place. These will include requiring you to prove your identity, as well as demonstrating that you do have the means to pay back any amount you borrow.

You’ll also want to know that they report to credit agencies when you pay back your loans. Unless they do this, your credit score won’t reflect your proven financial responsibilities.

The agency should also be realistic about your situation and offer you some options if you have difficulty paying back what you owe. While you’re always responsible for your agreements, it would be counter-intuitive for an agency to lend to an at-risk customer and fail to accommodate for the risk.

Whether it’s a one-time forgiveness or a flat-free late-charge, they should have reasonable alternatives to help you manage your responsibilities.

Final Thoughts

Money management is one of the most important responsibilities we have. It has a massive influence on our ability to achieve our goals.

Falling behind doesn’t make you a bad person. There are a million reasons why people can and do fall behind every day.

Needing a bad credit loan can be what you need to get that fighting chance at improving your situation.

Be realistic about where you are and what you need. You can find a lending agency that is willing to help you work towards financial freedom.

Don’t settle for the first agency willing to lay money down. Find someone that respects your situation and will help you improve it.

We are regularly helping people in difficult financial straits get the opportunity they need to overcome these difficulties. We work every day to help them break free from poor credit and get the life they want to live.

If you have any questions or concerns, we’re always here to help. Why not fill out an application form and see how we can help you today.

Couple reviewing their accounts with a digital tablet

In Debt? Here’s How to Take Control of Your Credit Cards

Being in debt sucks, plain and simple. Australia alone has a substantially shocking margin of household debt at nearly 125.2%.

Your credit, financial opportunities, and general financial standing take a big hit when you fall into debt – and it is very easy to do.

But being in debt doesn’t have to define you, and you can actually get out of debt pretty quickly.

We put together a guide to getting out of debt quickly and properly as well as how to manage your debt without being completely broke.

Ready for some handy knowledge and to get in control of your debt? Check out our awesome guide!

Being In Debt And How To Get Control

This guide can help you prevent, fix, and manage your debt.

Prevention Is Key

If you need cash quickly and are considering payday loans or credit cards, consider some alternatives before you potential get in debt.

There are a ton of things you can do to get cash quickly without the need for a lender:

Sell your stuff on Craigslist, eBay, or DePop. Look through your closet, garage, attic, and other places in your home for the junk you never use anymore and purge your life of garbage while simultaneously making money.

Pick up a side gig like driving for Uber, freelance writing or blogging, or housekeeping.

Use your savings. The key to this is to replenish your savings as quickly as you can after taking out the money. Saving is hard, but there are

Saving is hard, but there are a ton of resources out there that are ready to help you learn how to save.

Before you try to get approved for a loan or credit card, try these steps first.

Recognize When Things Are Getting Bad

It can often be very clear when your debt has spiraled out of control, but other times it can sneak up on you – and other people will notice before you do.

When credit card or loan debt gets to be overwhelming, it is easy to go straight to denial.

Do you ignore calls from unknown numbers, ignore your bills, and avoid conversations about finances with your partner or family? You might be in denial about the gravity of your debt.

Ignoring debt may seem to work for a while, but it isn’t going anywhere. Your accounts will rack up interest and late payment fees.

You need to snap out of that denial in order to give your debt attention it needs to disappear.

Just as well, if you have a super vague payoff deadline, you may be setting yourself up for disaster too.

Saying you will pay off your debts “eventually” is on any calendar. Make a solid but reasonable deadline for your debts to be paid off and work towards that goal.

Take Action With Little Steps First

Get control first and foremost by looking at all of your balance statements. Make a list of each individual debt you have plus their due dates, minimum payments, and their individual current interest rates.

Pay all of those minimum payments now.

Organize all of your debts starting with the one with the biggest interest rate. With any spare money you might have, try to pay addition money towards your highest interest debt.

As you earn income, reserve a significant amount of your paycheck to paying more and more of that highest interest loan off until the balance goes to zero.

Then, move on to the next ones. This will take a lot of time depending on how many debts you have, but it will work.

In addition to keeping track of your debts, also keep track of your incomes and expenses. Deduct how much money you have to spare monthly and dedicate that money to paying off your debts.

Balance Transfers

Credit card balance transfers are credit accounts with 0% APRs (usually introductory) that are used to reduce the burden of other credit card interest rates. With the balance from this low-interest card, you can pay off your more aggressive debts and combine them into one low-interest account.

Balance transfers can absolutely be helpful. However, it is easy to get stuck in the cycle of using balance transfer after balance transfer to avoid the later higher APR.

This also can apply to payday loans. Payday loans can be a fantastic solution to very short-term issues, but one can get stuck in the cycle of rollovers and high-interest rates if they are not careful.

Remember that moving a balance isn’t the same as getting rid of it. Use this formula for balance transfer card repayment:

Total balance transfer balance / # of months until the 0% introductory APR expires

The result of this calculation is your new monthly payment. If you stick to these payments, you’ll be debt free in no time without having to pay an aggressive APR on top of the debt.

Save, Save, Save!

Saving your money is how you will be able to pay off that debt. There are many ways to save money out there, and you should do your best to making a savings plan that works for you.

On top of saving money to use for debt repayments, try to save additional money on top of that to bulk up your savings account.

It doesn’t have to be a lot of money at all. Start with a couple dollars here and there, then gradually add more money to your savings account and do not spend that money on anything.

The security net of having a savings count and nurturing it until it can hold a substantial amount of money will make you feel safer and proud of yourself as well. When an emergency comes around, you will be both debt-free and prepared.

When an emergency comes around, you will be both debt-free and prepared. No need for a loan or a credit card.

Get Out Of Debt The Right Way

Was our guide to being in debt and getting out quickly and properly helpful to you?

Tell us your thoughts, along with your favorite tips for being in debt and getting out quickly, in the comments below!