By Tony Palmer

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In order to get a third tenant, they have to agree to lower the share of the rent for the new tenant to a quarter rather than a third of the total rent. Gwen and her friend have problems in finding money for the gas and electricity bills as well as the rent. Gwen is up against the limit on her credit card and applies for another card from a different provider to get more credit. September 2005 Six months later Gwen and her friend are in real trouble. They are under notice to quit for arrears of rent.

Your monthly payment is part repayment of the loan and part interest. In the early years of the mortgage, by far the greater part of the payment is interest, but as the outstanding capital gradually reduces, a greater and greater proportion of the monthly payment is repayment of the loan. 54 / G E T T I N G OUT OF D E B T AND S T A Y I N G OUT Are you willing to pay extra to have your rate fixed for a number of years? rates going up as well as down? No No Get a fixed rate mortgage Yes Consider a capped rate mortgage or Yes Do you expect rates to go up in the next five years?

Always read the small print before you sign up. First, let's look a bit more closely at interest rates and in particular some of the tricks banks get up to. They are trying to make the deals they are offering look a lot more attractive than they really are. When you are looking for ways of borrowing money (or saving it for that matter) you come across a whole range of technical terms. They are used by companies to confuse you rather than inform you. You will probably want to throw your hands in the air and say 'that's too complicated – I'll take the deal with the lowest rate in the advert.

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