However, consolidating existing credit commitments should not be considered a cure-all. If appropriately used, restructuring debts through consolidation can help you get debt free faster by reducing the interest burden of existing borrowings and bringing repayments within budget. On the other hand, if there are more serious underlying problems, it may only grant temporary relief before the creditors become unmanageable again.

If approved, the benefits of Debt Consolidation:

• You maybe be able to combine all of your current debt into one affordable repayment.
• Instead of dealing with multiple creditors and payments, you would deal with one company and generally make one repayment per month.
• This option could ease the financial strain by reducing your monthly outgoings.

Considerations:

• The monthly repayments need to be affordable or this could lead to a further reliance on credit.
• You are borrowing funds to pay off existing debts, as such your total debt level will likely increase when factoring in interest and charges charged on the consolidation loan.
• The amount you can borrow will be largely based on your income and credit rating, as such you may not be able to consolidate all of your debts.

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.