Need to settle credit card debts?
Loans ranging from £5000 to £75,000 are available. If you’re grappling with credit card debt and finding repayment challenging, worry not – a consolidation loan could be the solution. With the funds obtained, you can close your credit cards and simplify your payments to just one monthly instalment.
Enjoy the following advantages:
Consolidate Your Debts through 3 Steps
Initiate your journey with our fast and simple online application. Begin now >
We will assess your application.
Upon approval, the funds will be deposited directly into your account.
If you come across a loan that ultimately results in paying less in the long term, consolidating credit card debt might be a beneficial choice. Therefore, it’s crucial to carefully examine the terms and conditions before making a commitment and ensure:
While debt consolidation loans offer the convenience of combining debts into a single payment, it’s important to note that, in some instances, you may extend the period over which you pay off your debt with such a loan.
Additionally, in the uncommon situation where you opt to consolidate lower-interest debt with a consolidation loan featuring a higher interest rate, you might end up paying more in interest over the loan term.
As a broker, not a lender, we are actively dedicated to finding you the best possible deal. It is in our best interest to locate a consolidation loan that provides you with value for your money.
APRs from 5.8% to 89.9%
When borrowing £7,500 over 36 months with monthly repayments of £502, the total repayment amount is £18,083. This includes a total cost of credit of £10,583, at a variable interest rate of 69.9%. The lenders in our network provide loan terms ranging from 12 to 60 months, with APRs varying from 5.8% to 89.9%. Please note that the representative example is based on loans disbursed by lenders from April 19, 2022, to December 23, 2022.
Opting to include fees in the loan: For a £25,000 loan over 120 months, along with a £2,500 broker fee and a £250 lender fee, your monthly repayments would be £345.55. The variable borrowing rate is 8.6%, resulting in an 11.7% APRC. Total cost for credit is £16,466.00, and the total amount repayable is £41,466.00. You can also choose to pay the lender and/or broker fees upfront, with options discussed by your advisor.
What is the process of credit card consolidation?
Credit card consolidation involves using a loan to settle all outstanding balances with various lenders. For instance, if you hold credit cards from Natwest, Halifax, and American Express, a consolidation loan would encompass the total amount owed to these creditors.
The loan funds are then used to systematically close each account until your credit card debt is fully cleared. Instead of managing payments to multiple lenders, you consolidate everything into one, focusing solely on the company that granted your consolidation loan.
Typically, this results in more manageable monthly repayments, improved interest rates, and a shorter repayment period. For optimal effectiveness, a debt consolidation loan works best when the obtained loan amount is sufficient to clear all existing debts.
Can I use a bad credit balance transfer card to consolidate my credit card debt?
Many individuals contemplate settling their credit card debts through a bad credit balance transfer card. This card enables the consolidation of multiple credit card debts onto a new card with lower interest, primarily serving as a solution for credit card debt consolidation.
A balance transfer might not be the most fitting debt solution for you if:
In this case, you may find a debt consolidation loan is your best option to improve your financial situation.
“Bad Credit” is a term utilised to characterise a credit score that falls below a favourable threshold.
Multiple factors generally contribute to the occurrence of bad credit:
Individuals with poor credit often encounter challenges when seeking approval for new lines of credit. Nevertheless, the criteria for acceptance of debt consolidation loans from our panel of lenders at DebtConsolidation are determined by various factors.
Many individuals contemplate obtaining a bad credit credit card to clear their credit card debts. However, this may not always be the most financially sound choice.
Credit cards generally carry higher APRs than debt consolidation loans, especially for those with poor credit scores. Therefore, opting for a debt consolidation loan rather than acquiring another credit card is often a more favorable decision for one’s financial future.
Similar to various financial options, consolidating credit card debt has its advantages and disadvantages:
Initially, obtaining a consolidation loan may likely have a negative impact on your credit score, as it involves acquiring another line of credit. However, as you close accounts, reducing your credit utilization ratio, and consistently make timely payments, there should be an improvement in your credit score.
Focus on only one monthly payment.
No problem. We consider all credit scores – even bad ones!
We are experts in debt solutions.
No hidden upfront fees to worry about.
Real rates tailored just for you.
Focus on only one monthly payment.
No problem. We consider all credit scores – even bad ones!
We are experts in debt solutions.
No hidden upfront fees to worry about.
Real rates tailored just for you.
This represents the overall ratio of your outstanding balance divided by your credit limit. For instance, if your credit limit is £10,000 and you have an outstanding balance of £5,000, the ratio would be 50%. As a general recommendation, it’s advisable to maintain this ratio at approximately 30%.
Based on data from The Money Charity, the average individual in the UK would require over 26 years to settle their credit card debt if they make only minimum repayments. Additionally, the average credit card debt per household is approximately £2,600.
Given the challenges many face in repaying their debts, seeking a solution is a common inclination. After all, who would want to spend more than 25 years clearing their debts?
While using a credit card for debt consolidation is an option, it comes with inherent risks. Some card providers may offer an introductory 0% interest rate, but if the debts aren’t repaid within the specified timeframe, this solution can become prohibitively expensive. Ultimately, it might lead to a worse financial situation than before.
Transferring multiple accounts to one credit card often incurs a fee, the amount of which varies but can be significant.
Opting for a credit card could be a cost-effective solution if you manage to pay off your debts within the introductory period. However, missing the interest-free window may make you wish you had chosen a debt consolidation loan instead.
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You can visit the Money Helper website to find out more about managing your money and to get free advice, they are an independent service set up to help people manage their money
Your details might be used for a soft credit check, which you can see but lenders cannot. This will not impact your credit score. The lender will perform a credit check which will appear on your credit file.
DebtConsolidation.co.uk is a registered trading name of Dissolve Debt Limited, which is authorised and regulated by the Financial Conduct Authority and is entered on the financial services register under reference number: 662423. Dissolve Debt Limited is registered in England and Wales (Company Number 05278758), registered office; Paul House Stockport Road, Timperley, Altrincham, Cheshire, England, WA15 7UQ. Registered with the Information Commissioners Office, (Registration Number Z896984X).
Disclaimer
The Financial Ombudsman Service (FOS) is an agency for arbitrating on unresolved complaints between regulated firms and their clients. Full details on the FOS can be found on its website at www.financial-ombudsman.org.uk.
“Dissolve Debt Limited” act as a broker processing the information that you provide to us and pass this on to our Limited group of third party lenders and brokers.
We do not charge a borrowers fee for the use of our brokerage services, however we do receive commission from lenders (or other brokers) when borrowers sign into a credit agreement following an introduction through the Debt Consolidation website.
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As operator of this website, Debt Consolidation is not an agent or representative of consumers or any lenders and therefore does not endorse the services offered by specific lenders.
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Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
If you are thinking of consolidating existing borrowing, you should be aware that you may be extending the terms of the debt and increasing the total amount you repay.
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