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First Class. I was in was in a mess with my debts, but the way they sorted out all my problems and made life less stressful was great. The service and speed in which they sorted my IVA was superb.
. . .Andrewvia TrustPilot
What is a Debt Consolidation?
Debt Consolidation is a way of reorganising multiple debts. If you have several different debts such as credit cards, store cards, an overdraft etc... you can apply for a consolidation loan to clear all of the debts, leaving you with one structured payment each month owing to one creditor instead of many.
You can either obtain an unsecured loan to address the debts or if you are a homeowner, you may be able to obtain a secured loan, meaning the lender could secure the loan against your home, to protect themselves should you be unable to fulfill payments.
When looking for a loan, it is important that you shop around or even seek independent advice. It may not be your best option if you cannot get a loan with a competitive interest rate. If you don't have a good credit rating for example, it is not likely that you will get a loan on the best terms. If you do choose a loan to deal with your debts, it is highly advisable that you close all of the outstanding accounts that you paid off with the loan.
If you would like to find out more, fill in the form and one of our advisors will call you for a chat or scroll down the page for more information.
What are the benefits of a Debt Consolidation Loan?
You will have only 1 monthly debt repayment instead of many different payments to different creditors.
You will usually have 1 lower interest rate to pay, instead of lots of varied interest rates on multiple debts, meaning you will be saving money.
You will have less creditors to deal with.
You will have a set date for completion of the loan.
Your monthly repayment will be lower / no higher than what you are currently paying.
What are the disadvantages of a Debt Consolidation Loan?
You may have to pay fees for obtaining a loan.
You may not get a good interest rate if you have a poor credit rating, meaning the loan may not be your best choice for addressing your debts.
Your home may be at risk if you cannot keep up repayments on a secured loan.
Depending on your terms and conditions, your interest rates could vary throughout the duration of the loan. A fixed rate loan would be more advantageous than a variable rate loan.
If you don't clear all existing debts with the loan or choose not to close the existing accounts, you could end up financially worse off by making use of these debts again.
How much can I reduce my monthly payments by in Debt Consolidation?
This will depend on how much you are paying at the moment and how long you want to take to repay the loan.
When taking out a loan, how much can I borrow?
There are a variety of factors which dictate how much you can borrow. Whilst your income and, for secured loans, the equity available in your property are key, the main one is that you can afford to make the monthly repayments.
Over what length of time can I spread my payments?
This is entirely up to you and will depend on how much you can afford each month. Most loans are usually available over 3 to 25 years, though some loans, such as a mortgage can be spread over a longer period of time, depending on your individual circumstances.
What if I have an accident, become ill or get made redundant?
Some companies will arrange accident, sickness and unemployment cover if you want the added peace of mind this brings. Life assurance is also advisable. We would strongly advise that you consider very carefully before taking out any cover as it can be very costly to do so as some companies charge too much for this.
First Class. I was in was in a mess with my debts, but the way they sorted out all my problems and made life less stressful was great. The service and speed in which they sorted my IVA was superb.