The Fixer: cash-flow crisis

Have you been left out of pocket due to poor service or sharp practice? Do you have a money problem that won't go away?

It can seem impossible to get a fair result when you are battling a financial issue alone. But never fear! The AOL Money Fixer is here to help.

Dear Fixer,

I am having a bit of a cash-flow crisis due to my car needing expensive repairs and my boiler giving up the ghost, all within the space of a few weeks.

I have a good credit score so I know that I could take out a 0% credit card, but what I really need is some extra cash in my bank account for next month.

Is a short-term loan the best option? Thank you in advance for your help.

F Ashcroft, Bradford

Shop around for loans

Dear Mr Ashcroft,

Short-term loans are often an expensive way to borrow. With a payday loan of £100, for example, you will generally have to repay about £130 - even if you pay it off within the 28-day term.

And the charges for late payment can be huge. I would therefore recommend one of two options: a personal loan or a 0% credit card that allows you to make money transfers direct into your current account.

Which one is right for you depends on how much cash you need and how you plan to repay the debt.

If, for example, you need a cash injection of say £5,000, both Hitachi Personal Finance and Sainsbury's Bank are currently charging just 4.4% over three years.

With both deals, you would need to repay £148.32 a month for 36 months, and the total cost of the loan would be £339.47.

If, however, you only need say £1,000, the Virgin Money All Round Credit Card charges 0% for 24 months on money transfers, on which you will pay a 1.9% fee (or £19 on a £1,000 transfer).

You will need to be disciplined enough to clear the debt within the interest-free period, though. Otherwise, you will start paying interest on it at the card's standard rate of 18.9%.

Shop around for loans

The Fixer

Whatever your financial problem, write to themoneyfixer@aim.com and The AOL Money Fixer will get on the case.

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