Many households in the UK are suffering from high levels of debt, with a number of loans, credit cards, store cards, catalogues and more, each of which costs them a small fortune in interest.
With so many debts piling up on top of one another, a large number of residents in the UK face crippling monthly repayments, leaving them with little or no disposable income once repayments have been made. On top of this, trying to juggle a number of debts can prove very difficult to manage, increasing the chances of missing repayments, which can in turn adversely affect your credit rating.
Managing your debts - an effective solution
One very effective solution that has helped many households trying to manage a number of high interest debts is consolidation. Taking out a single larger consolidation loan to wrap up all of your smaller debts can benefit you in many ways. You will find that your debts are far easier to manage with a consolidation loan, as you will only have to make one single repayment rather than having to deal with a variety of repayments to a number of creditors.
Even more importantly, a consolidation loan could save you a small fortune when it comes to your monthly repayments, giving you more money in your pocket at the end of each month and reducing the chances of you missing repayments.
If you have a variety of debts that you are trying to manage, such as credit cards, store cards, personal loans, catalogues, and other high interest debts, taking out a consolidation loan can make a huge difference. You can take out a consolidation loan that will enable you to repay all of your other non-secured debts, thus reducing the number of repayment you have to pay each month and reducing the amount that you have to pay out each month.
Finding the best consolidation loan for you
Secured Loans
When it comes to taking out a consolidation loan, there are a number of options available to you depending upon your circumstances. A very popular and affordable option is the secured consolidation loan, which is available to homeowners and is a loan that is secured against your property.
The benefits of taking out a secured consolidation loan is that is can be spread over a longer period of time, which means that the repayments are far lower than with an unsecured loan. In addition, you will find that the interest rates charged on a secured consolidation loan can be very competitive, making this type of borrowing even more affordable. The lending criteria can vary between lenders, but is generally based upon the level of equity in your home, which means the market value of your home minus any mortgage or other loans already secured upon it. Another major benefit is that this type of loan is usually available to those with a poor credit rating, although the interest rate charged is generally higher for adverse credit customers than for those with good credit.
Unsecured Loans
Another option available to those looking to wrap up their credit into one more affordable repayment is an unsecured consolidation loan. This type of loan is ideal for non-homeowners, and can provide an effective solution to reducing monthly repayments and making debts more manageable.
The benefits of the unsecured consolidation loan is that it is low risk, because it is not secured against any asset; it can be faster to obtain than a secured loan because there is far less paperwork involved; and you can get some great deals on interest rates from reputable lenders. However, because the repayment periods offered with unsecured loans are shorter than with secured loans the monthly repayments are likely to be higher - although you could still be paying far less than you are with a number of smaller debts. You do need to have a good credit rating in order to be considered for an unsecured loan.
Consolidating your debts if you have a poor credit history
Your level of debt may already have resulted in your missing repayments or making regular late payments, and this may have adversely affected your credit rating, making it difficult for you to get any form of credit. However, if you have a tarnished credit history and you wish to consolidate your debts in order to make them more manageable, more affordable, and reduce the risk of missing any more repayments, there is still an option available to you.
Many secured lenders are able to consider lending to those with bad credit, because the loan is secured against property, which means a reduced risk to the lender. Those with poor credit will find it difficult r impossible to get unsecured credit, because they will be classed as high risk customers by unsecured lenders. However, by opting for a secured loan, you can enjoy the benefits of consolidating your higher interest debts even if your credit history if not very good.
Compare consolidation loans to find the right deal for your needs
The easiest way to find the best consolidation loan to suit your needs is to compare what’s on offer, and the Internet makes this task far faster and easier. You can check the repayment terms, interest rates, benefits, and exclusions, as well as compare quotes on monthly repayments, and you can even make your application online. In many cases you will receive an instant decision in principle, enabling you to quickly sort out your finances.
Using a valuable resource such as Personal-Loan-Comparison-Online.co.uk will enable you to compare the different loans and options available from the comfort of your own home and at your own pace, making the process of finding the right finance deal simple and effective.
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