Debt consolidation loans reducing monthly payments and consolidating credit cards.

Debt Consolidation Loans

Debt consolidation loans are available at competitive interest rates from our leading lenders and can help you to make your monthly debt repayments more manageable. The main advantage of these loans is that you could lower your monthly repayments to less than the sum you are currently paying to all your creditors, even though you will probably be paying over a longer period. You could also reduce the stress you may be under from having a number of creditors.

WHAT YOU NEED TO KNOW

You will need to look at a few considerations before taking out a debt consolidation loan. Firstly, you need to work out exactly how much you owe and this can be done by asking your creditors for settlement figures, not balances. A settlement figure will include any redemption penalty your creditor may charge you because you are paying off your debt before the agreed end date. Once you have a total you will need to look at your income and expenditure and decide whether you will be able to afford the repayments on debt consolidation loans. Don't forget to include an amount in your budget for emergencies.

ABOUT DEBT CONSOLIDATION LOANS

Debt consolidation loans can be secured or unsecured loans, depending on whether or not you are a homeowner. If you own your own home you can consider a secured loan. Because your home is used as security or collateral against the loan the lender is taking a fairly low risk in lending you money. This is why interest rates for secured loans are lower than for unsecured loans, where the lender requires no form of security in order to grant you the loan. The result is that unsecured loans have higher interest rates because the lender is taking a greater perceived risk. When you have bet your home that you will repay the loan, you must make sure that you keep up with the repayments and settle the debt as agreed or you will be putting your home in danger of repossession. A third option, and probably the cheapest, is for you to look at re-mortgaging your home as this would come at the lowest interest rates, probably close to your mortgage rate. This could release the cash you have tied up in the equity in your home and enable you to pay off all your debts.

Debt consolidation loans are repayable monthly and the sum paid includes an interest charge from the lending company. This is the Annual Percentage Rate, also referred to as the APR and differs from one lender to another. It is a good idea to keep in mind that the typical APR displayed by lenders and brokers is only a representation of the APR applicable. You will only know what APR you would be eligible for if you supply all relevant information to give lenders a true representation of your circumstances.

Take a moment to fill out our online application and you will have access to our competitive comparison of debt consolidation loans from our leading lenders.