Consolidating all your debts into one loan might appear to make life easier but there might be much better ways of dealing with debts.Find out more about how debt consolidation loans work, then get free debt advice before you make a decision.
You will still have to pay back all the monies owed, but with loan consolidation you may be able to reduce your monthly outgoings, pay a lower rate of interest, or be able to spread the costs out over a longer time period.
If you are careful about managing your spending, debt consolidation loans can help by: You may find yourself getting into debt for a longer period than needed, so it ‘s important to weigh up all the alternatives you could take to reduce your debts or help pay off your existing ones.
While consolidating debt often sounds like a promising solution, this could make your situation worse.
Consolidating debt usually involves taking out new credit to pay off existing credit.
There are two types of debt consolidation loan: Debt consolidation loans that are secured against your home are sometimes called homeowner loans.