It is a well known fact these days, that applying for a new personal loan or other form of credit is not as easy as it used to be, largely due to the fact that banks and other loan companies have placed much tighter lending criteria on their loan products, particularly when it comes to unsecured loans.

But a recent survey has suggested that many potential borrowers may be making the situation even harder of themselves, due to making several loan applications at the same time, or applying for an inappropriate loan amount or loan type.

The study, conducted by Freedom Finance via its own website, found that around 82 per cent of those individuals who had been rejected for a cheap loan deal were actually in full time employment, with a third of these having been in the same job for at least 10 years.

Furthermore, around 30 per cent of people who were rejected for a loan were earning more than £30,000 per year and 55 per cent were over the age of 40.

Freedom Finance has warned that making multiple loan applications can lower a person’s credit score, as each lender will carry out their own credit checks on an applicant, which will leave a mark on their record.

The survey also found that once a person had been rejected for a cheap loan deal from a bank or other lender, in many cases they turned to an expensive pay day loan as an alternative solution for their funding needs.

Nicola Winter of Freedom Finance said “Many consumers are being rejected for headline rates with other lenders and are not aware that there is an entire spectrum of loan products available to them that “soft search” sites are able to help them find without making the situation worse by damaging their credit rating.”

It is a well known fact that many individuals in the UK are having difficulty in coping with their financial problems and keeping up with their regular personal loan and other household bill repayments, but the scale of this problem is only just becoming apparent.

New research conducted by Moneysupemarket.com, has found that somewhere in the region of eight million people in the UK missed a loan or bill repayment over the course of the past twelve months, with missed credit card payments being the most common missed payment.

The survey found that around 3 million people missed a monthly payment on their credit card last year, which can have a dramatic effect on a person’s credit rating and make it more difficult for them to obtain finance, or a cheap loan deal at some point in the future, particularly with lending criteria being as tough as it is from lenders at the moment.

The next most commonly missed payment was council tax bills, with around two million people missing payments, followed by mobile phone bills, personal loan repayments, Sky TV and broadband payments and utility bills, such as gas and electric.

Kevin Mountford of Moneysupermarket.com said “Our research shows there’s still a worrying amount of Brits potentially damaging their credit rating by failing to pay their bills on time, with credit cards being the most missed.”

“A late or missed payment on a credit card not only impacts on your credit profile, but will also lead to the loss of promotional rates on the card, which can be a costly mistake. It is important that people are clear on what could damage their credit profile to make sure they don’t get caught out by simply not knowing.”

According to predictions from financial experts, the economic outlook for the UK is pretty bleak for at least the next twelve months, with high inflation, rising unemployment, high utility bills and high levels of personal debt on things like unsecured loans and credit cards.

A new survey, conducted by the Resolution Foundation, has shown that somewhere in the region of one third of the UK population intend to cut back on their spending over the course of this year, as almost a quarter of us expect our personal financial situation to get worse as the year progresses.

Back in October last year, a similar survey found that around 19 per cent were planning serious cut backs on their regular expenditure, however this figure has now increased to 32 per cent, as the gloomy financial outlook and post Christmas blues are forcing people to take stock of their finances and loan debts.

In the October survey, around 12 per cent of people said that repaying their personal loan and credit card debt was a priority for them. However this figure has now increased to 17 per cent of people who are reducing their credit card bills and overpaying on their loans.

At the same time, the number of people who are putting savings away on a regular basis to provide themselves with an emergency fund, has increased from 22 per cent back in October to 30 per cent now.

Gavin Kelly of the Resolution Foundation said “Families that are already hard pressed are preparing for yet another very tough year ahead, with a big rise in the numbers planning to cut back on spending as well as trying to save and reduce their loan debts.”

“Given this gloomy backdrop it’s a real worry that a new round of cuts to tax credits planned for April will further dampen the spending power of low to middle income families.”

Following a recent investigation, the EU is starting to enforce a crackdown on websites which offer personal loans and other forms of credit, which it finds to be misleading to a new customer who is looking for a personal loan.

The investigation across the EU member states found that around 70 per cent of the loan websites it checked fell outside of the legal requirements for someone offering loans or credit to its customers via their website.

Across similar websites in the UK, the figure was actually 81 per cent, with 38 out of the 47 websites which were checked, having some form of error, or misleading information about the loans it offered.

The most common breach of regulations was websites failing to show the APR (Annual Percentage Rate) of the loans they offered, or other similar important information to show the borrower the actual cost of the loan they applied for.

Around 43 per cent of checked loan websites also failed to inform customers whether or not the cost included any insurance products, type of interest rate, what the term of the loan was, or if there were any arrangement fees on the loan.

EU enforcement officers have been targeting websites across Europe which offer, credit cards, pay day loans and car loans, amongst others and they have warned that any websites which do not conform to regulations, or are found to be repeat offenders, will be either fined or shut down.

John Dalli, EU Consumer Commissioner, said “Online credit often turns out to be more expensive than it had original appeared, because important information is sometimes unclear or missing. Consumer credit is not always easy to understand, which is why there is European legislation in place to help consumers.”

People in the UK seem to have lost the ability to save money on a regular basis, according to a new survey from First Direct bank. Many individuals do not even have enough savings behind them to see them through the next weekend, if their income were to suddenly stop.

It is advisable to have sufficient savings as an emergency fund to be able to cover your household bills and loans for a period of at least three months, however, the survey found that around 28 per cent of the population actually have less than £250 in savings which they could get their hands of if needed.

Young people between the ages of 25 and 34 seem to be the least prepared, with 39 per cent having less than £250 put to one side and 30 per cent having no savings at all to fall back on.

Many people in this situation would not be able to pay their rent or home owner loan if their income suddenly stopped, let alone their normal household bills, personal loans and credit card debts.

When asked about how they would cope in the event of losing their income, around 11 per cent said that they would take out a personal loan or use a credit card as an emergency fund, with a further 11 per cent saying they would use their overdraft facility.

Many individuals are currently focusing on repaying their existing loan and card debts rather than saving, but these people need to create a balance and put some money to one side for emergencies.

Bruno Genovese of First Direct said “These findings demonstrate a worrying lack of financial preparation among the British pubic. With the current climate of uncertainty, it is of utmost importance that families are setting aside a realistic sum of money to be used in emergencies.”