A simple way to make your debt repayments more manageable
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Find out more about the fees involved with each debt solution.
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Call us on 0800 970 7673or fill in our simple form to receive a free no obligation call back from one of our friendly, experienced advisers.
It's a loan that can be used to repay multiple existing debts. By doing so, you're basically rolling them into one - leaving you with one easy-to-manage monthly payment.
A debt consolidation loan could also help you to reduce your monthly outgoings if you choose to repay it over a longer period than your original debts (but keep in mind that this could increase the overall amount of interest you pay).
Basically, the longer your repayment period, the smaller each payment will be.
As a basic example, imagine you have several debts amounting to £5,000 that will take three years to repay - costing you around £139 a month (plus interest). Consolidating these into a single loan and repaying it over five years would reduce your payments to around £83 a month (plus interest).
Debt consolidation loans aren't designed to help with serious debt problems - there are other debt solutions for that.
Debt consolidation loans are intended for people who want to make managing their finances simpler and/or reduce their monthly outgoings.
You can actually consolidate debts with any loan, but searching for a good deal takes time. We can search our wide range of lenders on your behalf, to help you find a deal you're happy with. We can also offer practical advice on managing your debts.
However, debt consolidation loans aren't the best solution for everyone. Trying to manage your debts without seeking expert advice beforehand could cause problems further down the line, so it's well worth talking to us before you start. We'll let you know which solution is right for you.
Yes. A debt consolidation loan can be used to repay any kind of debt.
Whether your debts are secured or unsecured won't be an issue, because you're not making any changes to your actual repayment arrangements - you're simply paying off existing debts and replacing them with a new loan.
No - in fact, it could help to improve it.
Other debt solutions may harm your credit rating if they involve making smaller payments towards your debts than you originally agreed. But repaying your debts in full with a debt consolidation loan will leave a positive mark on your credit history, and so will keeping up with your new loan payments.
Of course, failing to meet your debt consolidation loan repayments would damage your credit rating - so only take out a new loan if you're sure you can afford to pay it back.
It's possible, but it might be difficult. Lenders are more cautious than they used to be and there are no guarantees that your application will be accepted. And even if it is accepted, you're likely to be offered a higher interest rate if your credit rating is poor.
Consider how your interest rate will affect your overall costs before you take out a debt consolidation loan.
Like any debt solution, a debt consolidation loan has some disadvantages. In particular, it could cost you more in the long run if you choose to repay your debts over a longer period of time than your original debts.
However, you may consider this acceptable if it means lower month-to-month costs.
Finally, remember that securing other debts against your home means you risk losing your home if you can't keep up with your repayments.