Consolidation Loan
This is unlikely to be a good option for most people as it involves talking on more debt. It entails applying for a loan which you would then use to repay your debts.
It should only ever be considered if the interest you will pay on the new loan is less than the interest on your other debts AND you can truly afford the new repayments.
Advantages
Potentially less negative impact on your credit rating.
You will be making one monthly payment rather than many payments to different creditors.
Your new monthly payment should be lower.
Disadvantages
Your credit rating may not enable you to get a new loan, or it may be very expensive.
The lender may want to secure the new loan on your house if you own one, which may put your home at risk.
The interest rate on your new loan may increase over time which may make it unaffordable.
The new loan may take longer to repay than your original debts meaning you actually end up paying a lot more overall.
Feeling overwhelmed by debt or money worries?
Speak to one of our a debt advisors.