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- What is a Debt Consolidation Loan?
- A consolidation loan offers the opportunity to put all your outstanding balances together into one block. This can include credit cards, personal loans and sometimes your mortgage.
- What is an unsecured loan?
- An unsecured loan is a loan where no asset is pledged as security for the loan. (The most frequently used security is the family home.)
- What interest rate will I pay and is it negotiable?
- Interest rates vary from lender to lender, and it all depends on how much you borrow, and over what period of time.
- How long can I take the loan over?
- How long you take the loan over depends on how much you need and how much you can afford to repay on a monthly basis.
- Will the loan company contact my employer?
- Firstly, a loan company will never contact your employer without your consent.
What is a Debt Consolidation Loan?
A consolidation loan offers the opportunity to put all your outstanding balances together into one block. This can include credit cards, personal loans and sometimes your mortgage.
If it’s all getting too much and you cannot manage all the repayments, a debt consolidation loan is a good idea. However you don’t have to be in financial trouble to get a consolidation loan, it may just be because you’d prefer to tidy up your finances by putting all your debt with one company, then it’s easier to know exactly where you stand. It also means you can borrow over a longer period of time and therefore reduce your payments – or you could borrow more than you need to cover your debts, in order to buy a car, holiday, or whatever you want.
When opening the loan the loan provider will pay off all your existing debts, then you will pay one single monthly sum to your new loan provider. Because you are borrowing a larger sum of money to repay all your debts in one go, you may benefit from lower interest rates compared to your credit card, store card and other outstanding debt interest rates. These types of loans are usually secured on your home so you must make sure you can afford the new repayments, or your home will be at risk.
For a Consolidation Loan
Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it. Security by way of a charge on your home may be required.
Think carefully before securing other debts to your home.
- Adverse credit and finance ?
- No proof of income ?
- If i decide a personal loan is best which type of lender is best ?
- What exactly is a personal loan?
- How much can i borrow ?
- What if my loan application is not accepted ?
- What happens if i am suddenly injured or taken ill ?
- Should i get personal loan payment protection insurance ?
- In what circumstances should I consider taking out a personal loan?
- Is there a way to get a debt consolidation loan that does not require offering your house as security or a way to get a debt consolidation loan if you do not own a house?
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UK Debt Advice
Abacus offers UK Debt Advice, Consolidation loans & Management programmes.
Bad Credit Loans
Abacus help UK residents who have been refused a loan elsewhere.