Qualified and now working
Having qualified, and started work, you should now have an excess of income; your net pay, over expenditure.
As you start your new job, there will be initial expenses to cover in the first few weeks; for example a deposit and advance rental on property, but in most months you should have more income than expenditure.
As with your student years, it is important to build up a good track record of credit / loan repayment by meeting repayments on time and sticking to overdraft limits. Overdrafts should not be increasing - if they are, then you need to re-schedule existing debt to meet your monthly income, and stop borrowing any more until this is resolved. As a young professional you will want to live in a superior property than as a student, have higher quality furniture, perhaps a new car, or be looking to buy your own property.
As with your student years, debt is not a problem if it is kept to affordable levels and you are making the required repayments, but it is likely the amounts borrowed will now be higher. As such, lenders will be very careful when assessing your ability to repay any new loan from disposable income. Having met all the lending criteria, you need to ensure you are getting value for money on any loan or credit agreement. Make sure you understand the way in which the interest is added to the loan, how any arrangement fees are added or if there are any other charges involved.
You should take special care when considering specific deals with attractive initial ratesand make sure you read the small print. These arrangements are quite often for high interest charges which are merely deferred if you meet the payment schedule. Check that there are no immediate penalties for delayed payments as this may trigger the higher interest charges on the full loan.
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