Debt consolidation loans allow you to collect all your existing debts together and combine them into one single monthly repayment. This can include credit cards, household bills and other loan payments.
If you find that your credit card bills are catching up with you and there are more and more bills stacking up on the kitchen table, a debt consolidation loan could be the answer you are looking for.
You can borrow from £100-£25,000 with Badger Loans on either a secured or unsecured basis. Just tick the correct box on the application form and our panel will do the rest.
How Does a Debt Consolidation Loan Work?
A debt consolidation loan takes all your current debts and puts them into one single loan. You then have a single repayment to one company instead of multiple payments to multiple companies. They can make life much easier all round.
In most cases, you will be able to borrow the money and pay off the debts at your own discretion.
Key Features
- Borrow up to £25,000
- Repaid over 1 to 5 years
- Choice of secured or unsecured
- All debts into one single loan
- Pay off monthly
- Become debt free
Debt Consolidation Loans Eligibility
- Over 18 years of age
- Full time UK resident
- Employed and can afford monthly repayments
- Good to fair credit score (unsecured)
- Proof of ownership of home (secured)
Unsecured Debt Consolidation Loans
If you wish to apply for an unsecured product, your eligibility will be based on your income and credit score. You will therefore need to meet the minimum requirements.
If your loan is unsecured it will not be secured against anything valuable you own, such as your car or home. This means you do not risk them being repossessed if you cannot keep up the repayments. However, failing to repay on time could impact your credit rating and make your loan more expensive.
Secured Debt Consolidation Loans
If you are applying for a secured loan, this will require your application to be secured against your home or similar asset.
Your asset could be at risk of repossession if you cannot keep up with repayments. This is because the lender will need to claim ownership and sell the asset to recover their costs.
With some lenders, the provider will pay off your bills and you will have to pay off the lender on time each month.
Should I Get a Debt Consolidation Loan?
If you have multiple credit cards and personal loans open, using a debt consolidation loan can be one way to gather all your debts and pay them off more effectively.
If you have payments for credit cards and loans that are going into arrears, this can often incur added charges and late fees. Hence using a debt consolidation loan could help you limit these.
In addition, the rates offered for debt consolidation can be more reasonable than if you continued to use short term high cost credit.
Consolidate Your Credit Card Debts
If you have a lot of existing credit card debt, you can collate all existing payments and pay them off using a debt consolidation loan. This can be an effective to pay off all your debts and stop the interest racking up. Thereafter, you simply need to pay off your main consolidation loan on time and you will eventually be debt free.
Can I Get a Debt Consolidation Loan with Bad Credit?
Yes, you can apply for a debt consolidation loan for bad credit and this is very common. If the individual has fallen behind on payments for other financial products, their credit score will have suffered. If so, they are more likely to use a secured debt consolidation loan to get their loan successfully approved.
You will still need to have a regular income, be able to afford monthly repayments and be the owner of the property or vehicle to be eligible.
How to Apply for Debt Consolidation with Badger Loans
Badger loans offers a completely online application so you can fill in your details and get a provisional quote on the screen in less than 5 minutes. If you want a secured debt consolidation loan, go to our secured loan page.
We work with a range of debt consolidation lenders helping you find the best product.
To help speed up your application, list all your outstanding debts and the names of the companies that you are working with already. This will allow for a smoother process and once your details are approved, your loan can be funded as soon as possible.