TV advertisements promote debt
Sitting through the news or your favourite sports programme can be educative and enjoyable but it can also land you into serious debt if you are enticed into the sales hype associated with commercials.
With promise of fantastic interest rates and an easy way to reduce debt, it is easy to put down your beer and make a quick call, but now advertisers are becoming even more ruthless and one particular company are promising you interest back.
Quarterback, which are part of Nemo Personal Finance are promising customers that they will receive a quarter of what they have paid in interest, if they sign up for a loan with a ten year repayment period. This looks too good to be true and it is.
What the advertiser fails to mention is that this is a secured loan and the rates are variable, so a loan which started out with a typical rate of 8.9% could rise dramatically soon after the ink has dried on your application.
To apply for the rebate, a customer has to spread the payments over ten years. If he wishes to settle the account sooner, he will lose all rights to receiving the interest. This makes it unlikely for many to benefit from this scheme, as most people are able to settle their loans within three to four years.
Good debt advice for those wishing to borrow small sums would be to apply for a short term unsecured loan, which will allow them to pay off their loans quicker, and at a lower fixed-rate APR.
Debt Advice News posted on 03/09/2007 10:28:22
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