Why should you consolidate debt?
There are plenty of reasons why people choose to take out a loan to consolidate debt. They include:
- More streamlined borrowing. It’s easier to keep an eye on who you owe money to.
- Clearer money management. Fixed monthly repayments keep things transparent and avoid hidden surprises.
- Paying a new interest rate. Consolidated loans may offer a lower interest rate than your existing borrowing – although this isn’t guaranteed.
- Remember, taking on any new debt is a big decision; extending the term of your debt can incur more interest and cost more in the long run and sometimes an early repayment charge may apply.