Things to consider when consolidating debt
You need to budget enough every month to cover all your household costs. You shouldn’t use any more credit until you’ve repaid the consolidation loan in full.
If you’re in arrears with your current creditors, your credit rating is likely to have been affected. This may mean that you’re unable to get a loan at a good rate of interest.
It’s important that you understand how much you’ll pay for the loan in full. If you extend the loan over a longer term than your original debts you’ll be paying more in interest and so increasing the amount of debt you have.
We recommend that you don’t consolidate your unsecured debts - such as credit card debt or personal loans - by taking out a secured loan, which will secure the debts against your house. This means that if you fall behind with the payments in the future, your home will be at risk of repossession.
Before you take out a consolidation loan use our online Debt Remedy tool or call our free Helpline on 0800 138 1111 as we may be able to find a better solution for you.