Use our UK Finance guide and learn by experience. We outline pitfalls so that you don't have to learn the hard way, as many of us often do.
Loans
Debt Consolidation Loans
In a sentence, debt consolidation is the ability to borrow money to pay off all your debts. This leaves you with one easy monthly payment which will be lower than you normally pay and at a lower interest rate too.
In the age of the credit card, everything from cars to holidays and home improvements are paid for with plastic. Unfortunately though, many people spend more than they're earning and they're soon left with nasty credit card debt. Left unchecked, credit card debt can cripple you financially for many years to come.
Debt consolidation loans are the leading means of overcoming debt. It must be said though, that whilst this may settle your debt, it doesn't get to the root of the problem and if you don't become money smart and learn to manage your finances better, you'll be back in debt in no time.
The advantages of debt consolidation are many. You pay a lower monthly amount because the loan period is often longer than a standard repayment window. Secondly the interest rate is a lot lower than a credit card's interest for example, so you're saving money long term too. Thus by having a little more money in your pocket each month, you're still able to lead a normal life whislt slowly working on overcoming your debt.
