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Credit Management : How To Borrow Responsibly

• It should not come as a surprise that any loan you may access comes with an interest which will have to be paid in full as well as the amount borrowed . As a general rule of thumb , the more money you borrow , the more you will have to pay back . There are also two types of interest you may find yourself faced with . One would be fixed which means it does not change over time and a variable one which as the name suggest can either increase or decrease throughout the loan period .

• One should always remember also that there are many different types of credits that are suitable for many different situations . If you are looking for a short term loan to pay off some minor things a credit card might be the best option .

• There may also be the case that you have a poor credit record which means it is increasingly harder to access a loan , even for a low amount . In these situations , you could take into consideration an option called ‘ bad credit ’ loan . It may sound like an escape door , but it usually means the interest is higher and if it happens to miss a payment , it will affect your credit scores even more . However , desperate times call for desperate measures and if you find yourself in a desperate situation , the upside is that you will actually be able to resolve your financial situation , but in the long term you will need to build your credit back up .