How to consolidate debts with an unsecured loan

Last post: Sep 28, 2017

Are you repaying several debts all at once? Chances are, you're struggling to keep up. Juggling multiple repayments can be tough, even when you've got the funds. That's why consolidating your debts with a new loan could be a good option. Here's why – and how it works.

 There are so many areas of life in which it would be very useful to be an octopus – or at least have an extra arm. From childcare and hectic work lives, to managing your finances and taking care of the everyday nitty gritty, keeping up and keeping track of everything can feel like a massive challenge a lot of the time.

That's why repaying several debts simultaneously is rarely a good idea for anyone. Sometimes our finances spiral and we can find ourselves taking on a number of different debts all at once – from car repayments to overdue rent. Even when you have the funds to meet your repayments, keeping up with everything can be very tough.

This is an easy route to missed payments, which in turn become penalty fees and even more money matters to take care of...

So far, so stressful.

But many people are now opting to make life simpler by consolidating their different debts using an unsecured loan. This practice involves taking out a new loan which covers the cost of all of your repayments. You will then use this sum to repay all of your creditors at once, leaving you with just one, more manageable loan to service.

This is a great option if:

  • You're struggling to keep up with multiple repayments
  • Your creditors do not apply early repayment penalties
  • You're paying over the odds on interest

Taking on a consolidating, unsecured loan will make admin much easier and, in some cases, can even make the repayment process cheaper. If your creditors don't charge early repayment penalties but are charging you a very high rate of interest, you may be able to find an unsecured loan with a lower interest rate which will make repayment cheaper over the long term.

Want to explore your options further? We help our customers identify the best unsecured loans for their precise positions, then make arranging loans simple. We provide access to loans up to £25,000 – available with flexible terms. Contact our friendly team to find out more today.