As the New Year approaches, many of us will be planning our resolutions for the coming twelve months. If you have decided that this will be the year to finally boost your confidence by treating yourself to a cosmetic treatment, you may be wondering how best to finance your procedure.
In common with all financial planning, opting to finance your surgery is not a decision you should rush into. However, as long as you do your research and don’t take on more debt that you can afford, taking out a loan or low rate credit card to cover the cost can be good options.
How does a loan work?
You will need to be clear on exactly how much you want to borrow, and have all pertinent paperwork gathered together. You will need to be able to prove your address (it helps if you are on the electoral register) and may need to produce bank statements, pay slips and so on to demonstrate your income. If you have a decent credit history and a corresponding high credit score, you should find it relatively easy to get accepted for a personal (unsecured) loan.
The pros and cons
Borrowing to cover the costs of your surgery (and aftercare if applicable) can be a good idea, so long as you are in a secure financial position. Paying for your procedure incrementally offers an affordable way to achieve a beauty goal that you may not be able to afford to pay for outright. Of course, you will need to pay interest on the sum that you borrow, but most people still find this to be a more affordable option than getting together the funds upfront. However, if your circumstances change during the repayment term and you can no longer afford to service the debt, your credit score will be damaged and you will almost certainly have to pay a penalty charge.
Can I still get finance with bad credit?
If your credit score is low because of past financial difficulties, you may struggle to get accepted for credit of this particular variety. If you are already struggling, it would seem counter-intuitive to take out a loan for a non-essential cosmetic procedure. However, one route open to you is to find someone (a family member or close friend) who is willing to guarantee the loan. This could be enough to swing the balance in your favour.
Do I need to get a loan for the total cost of the procedure?
No, not necessarily. Most providers will lend between two and twenty-five thousand pounds, depending on how well you fit their lending criteria. In the most basic terms, the less you need to borrow, the more likely to are to have your application rubber-stamped. Lots of clients opt to pay for a percentage of their surgery up front, either with a credit card or perhaps cash from savings, and then take out a loan to cover the balance.
Will my loan be secured?
Most loans taken out for this purpose are unsecured, so you aren’t required to offer any collateral, such as your property. While this lowers the risk to you, the borrower, it raises that of the lender. This is why interest rates on unsecured products tend to be on the high side, as the provider seeks to balance its risk. If you are a homeowner, you could be eligible for a secured loan, which could be more affordable as the interest rates tend to be lower and the repayment terms longer. It is essential to remember that if you default on a loan of this type, you could lose your property.
Can I use a credit card?
If you meet the criteria for a credit card with a 0% introductory rate, this could be an ideal way to finance your surgery, so long as you are confident you can repay what you own before the interest rate hikes.