Debt management calls for a lot of financial prudence and discipline. With bad credit rating, debt consolidation turns out to be one of the key parts of restoring credit history. If you too are looking for assistance on using debt consolidation loans to mend your credit situation here is a practical guide. We have also compiled a list of Frequently Asked Questions for bad credit borrowers here:
1.How to know if I need debt consolidation for my poor credit rating?
When the sum of your credit bills and current loan(s) amount is more than what you could manage every month, debt consolidation could be an option for you. Rather than faltering on loan payments or rolling over credit bills and attracting more interest month on month, it is better to convert multiple bills into a single affordable loan. However, you need to ensure that the total consolidated loan amount is not too high for you to pay back with your current income. If such is the case, you may require to avail a couple of debt management tools including debt consolidation loan.
2.Does debt consolidation loan save enough fund?
Ideally, a debt consolidation loan is meant to convert your outstretched loans and credit accounts into a single affordable loan. While no one can guarantee a cheaper loan, however, the purpose of debt consolidation is saving money and improving credit situation. In case you find it difficult to manage your debt account, you can consider using a professional advice and use a broker’s advice for the same. A loan broker registered by FCA would help you connect with reliable lenders offering cheaper debt consolidation for people with poor credit score. They are experts in searching out rare loans with no upfront fees.
3.What types of debt consolidation loans are available in the UK?
It would not be a cakewalk to search directly for debt consolidation loans with bad credit history. But there are several brokers who work online to connect bad credit borrowers with private lenders. They can help you find the best available deals in the UK.
You can consolidate your loans into secured consolidation loan or unsecured loan. While the secured consolidation would help you get a cheaper loan, an unsecured loan could be too taxing for your pocket. When you contact a loan broker, they basically assess your credit situation and suggest the most affordable options.
4.Does debt consolidation always work?
No one can guarantee the success of your loan. For, it would entirely depend on how you manage your finances. Debt consolidation loan would just be an easier means to get out of debt, it is you who would need to put in efforts to make it a success.
You may choose frugal living, budgeting and money saving tips to get your finances in order. In fact, your broker can share professional advice for the same. They also help to make repayment plans and support borrowers to complete their loans on time.
5.How to find a reliable debt consolidation loan?
Rather than going directly to a lender for debt consolidation loan, contact a loan broker. They can search a bespoke deal for you amongst a pool of lenders. You can choose the one that best suits you. This is probably the most hassle-free and convenient way to find a bad credit loan.