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UK Debt Consolidation Loan

Debt consolidation is a loan used to repay several other loans. In other words it combines several debt obligations into one debt.

If you find you have several monthly payments on a number of different loans, you can make things easier for yourself by bringing them all together or consolidating with one single loan to pay off the total debt. This would mean that you only have one monthly payment.

 

Debt consolidation usually reduces the borrower's monthly payments by lowering the interest rate or extending the repayment period or sometimes both.
If you have generated a number of store card, personal loans or credit cards debts over a period of time, you will probably be finding it hard to make regular monthly payments. It can get rather worrying if you have got yourself into what seems like a never ending tunnel of debt.

The need for Debt Consolidation
There has been a considerable increase in the number of people seeking debt advice, many are families who find they have to spend more than 50% of their annual income on debt repayments. There are many reasons why people get into debt. They haven’t looked at their budget properly to see how much actual spare money they have each month, it could be that a divorce has made repayments difficult to meet, bereavement can also be a major factor, or maybe redundancy is to blame. Even having a new baby can affect monthly income, so it is not always through any fault of your own that you sink lower into debt.

The aim of Debt Consolidation
The aim of a debt consolidation loan is to lower your monthly payments thus taking away some of the pressure on you. You can usually find a debt consolidation loan with a lower interest when it is secured on your home. A lower monthly payment can be obtained by increasing the term of the loan.

A Debt Consolidation Loan can in fact help you along the road to a better financial status, if you keep up payments it can help you obtain a good credit rating. However, you should realise that in the short term you are increasing your debt by arranging repayments over a longer period.

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Typical, variable APR is 10.9%. Rates range from 7.7% to 18.3%
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP MORTGAGE OR DEBT REPAYMENTS SECURED ON IT
THINK CAREFULLY BEFORE SECURING ANY OTHER DEBT ON YOUR HOME. NON PAYMENT OF ANY LOAN CAN AFFECT YOUR CREDIT RATING

Every effort has been made to ensure that the facts here are correct. No liability is accepted for any errors contained herein or for any loss resulting from actions taken.