The Business Debt Advisor

Debt Consolidation Explained

Consolidation is a popular option for many of those in debt, but many people are still not completely clear on what it entails. Below are some of the main points of debt consolidation explained.

 

Consolidating debt through remortgaging, obtaining a secured or an unsecured loan and is the solution that most people automatically choose. This may increase the total amount you repay, but if keeping your monthly payments down is a priority then a loan which lets you spread the cost over a longer period could be right for you.

You will find below more information on different methods of raising finance, and The Debt Advisor can help with debt consolidation, whichever method is chosen.

 

Remortgaging

Borrowing additional money on your mortgage is often the cheapest way to raise extra funds. There are a range of lenders who offer remortgages to for debt consolidation, so it is good to shop around.

You need to carefully consider whether you can afford the new mortgage repayments. Please use our debt calculator to review your income and expenditure, or call our debt advisors for more help with consolidation.

 

Secured Loans

Secured loans can be completed relatively quickly and are more appropriate if you need to raise less than £25,000. The monthly interest rate will be higher than with a remortgage, but the term of the loan is usually shorter.

 

Unsecured Loans

Consolidating your debt through an unsecured loan is preferable to a loan that is secured on your property. Unsecured loans almost always require good to excellent credit and the interest charges are generally much higher especially if you have impaired credit.

 

Word of Warning

Debt consolidation will not cure your problems if you don't rectify the true cause of your debt. Even if we give you debt consolidation help to solve the current problem, if you have previously lived beyond your means and your spending habits continue, you will end up back in debt with your property and livelihood possibly at serious risk.

Your home is at risk if you do not keep up repayments on your mortgage or secured loan. There is little sense in securing your debts if you cannot keep up the repayments. With interest and charges you will significantly increase the level of debt outstanding.

Please contact The Debt Advisor Ltd today. We will be able to explain debt consolidation,  recommend the best solution for you based on your individual circumstances, and give you help with debt consolidation.

 

The Next Step

All debt solutions should be very carefully considered; we will always provide you with the best advice to ensure you get a soft landing away from the burden of debt. Simply forward your details on our Contact Form and we will contact you. Alternatively ring us on our FREEPHONE ADVICE LINE 0800 085 1825 to have a full consultation with our specially trained advisors.

The Insolvency Service has produced a guide: In Debt - Dealing with your creditors, to support those who find themselves in financial difficulty during the recession.

 

Financial Information

All debt solutions should be very carefully considered. Fees will be charged if a solution is taken in order for us to set up and maintain your plan - all fees will be outlined during your consultation. For further information on fees, please see the FAQ section of the different solutions available. Retained payment may place you further into arrears. The Debt Advisor complies with the Consumer Credit Act and you have a right to a cooling off period of 7 days. It is likely that your ability to obtain further credit in the short term will be affected and this may also be the case over the medium to long term.