As credit and finance turmoil continues far beyond the timeframe that most economists predicted, Bad Credit Loans offer consumers an immediate and practical solution.
Whilst bad credit loans have been around for decades, they have been growing in popularity, as households are challenged by increasing problems on a variety of fronts.
The average Brit is dealing with higher inflation and a lack of available bank loans. So far this year consumers have seen a doubling of price inflation, with the Consumer Price Index growing from 3.8 per cent in June to 4.4 per cent in July. And there is likely more to come. The price of credit card debt and short term loans, for example, has escalated dramatically. Credit card interest rates are fast approaching 18 percent, although last year it was possible to pay with plastic and pay interest rates closer to 15 percent.
Plus, the Governor of the Bank of England told the Telegraph that British companies could take advantage of the spike in inflation to increase prices and potentially reap bigger profits. "The concern is that we end up in an environment in which firms feel it is easier to pass on higher costs in the form of higher prices," he was quoted as saying.
Centrica, parent company of British Gas, recently raised gas prices for 10 million households by 35 percent.
The company also announced an 88 percent rise in pre-tax profits to £2.97 billion for the first half of this year.
The average annual gas bill for British Gas customers is now more than £1,300, with four million customers seeing an increase of 42 per cent on their annual bill.
Almost 30 percent of British households say they are already worried about how they will heat their homes this winter, according to a recent consumer survey.
4.5 million British households have trouble paying for heating fuel, but some industry analysts predict that if prices continue to rise the figure could hit 5.5 million.
Meanwhile a former chief economist at the IMF warned that the worst part of the credit crisis is not behind us, but ahead of us. Furthermore, the added prospect of diminished buying power due to weaker UK currency is emerging as a new and disturbing source of trouble. The pound is the weakest it has been in more than a decade - having fallen to a record low against the euro - and that means that a pound is worth less, even as prices continue a steady rise.
But despite the distress felt by consumers, the Telegraph reports that "five of the world's biggest retail banks made nearly £500 million more in profits for the first half of 2008 than the first half of 2007, while raising the rates on their products." Approximately 3,000 homeowners each month lose their homes to repossession as they struggle to make mortgage payments and fall too far behind. But at the same time banks - by increasing what they charge for loans and other services - are raking in the profits. HSBC, Lloyds TSB, Royal Bank of Scotland, Barclays, and HBOS made combined profits of £4.294 billion in 2008, compared to £3.808 billion in 2007.
It's not surprising that under these current conditions many UK consumers are looking to lenders of loans for bad credit as a more user-friendly and manageable alternative to conventional banks and mortgage lenders. Fortunately for them, they still have a reliable source of funds and a dependable ally in the fight against simultaneous price inflation and economic recession.
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