Question

Jon,

I have £6,000 of debt between 2 credit cards and a personal loan. I am not in arrears, but am looking at a quicker way to pay these accounts off. I looked in a consolidation loan, and I have been pre-approved or the bank’s eligibility checker says I could get the loan.

Any thoughts on consolidating debts?

Thank you,

Pam

Answer

Pam,

For some, a consolidation loan can be a way to get out of debt at a faster rate, but there are some things to consider.

The main thing to review is how did you find yourself in debt with the 3 accounts? If that was an issue and has been remedied, then a consolidation loan could be a good option.

You also may wish to look at if you can pay extra towards the accounts you have now, and see how quickly you can pay them off with out the consolidation loan.

Compare that time frame with the term of the new loan, and see which is quicker.

Lastly if you do consolidate the accounts, you may wish to hide the credit cards away, as not to be tempted to use them unless it is an emergency.

Regards,

Jon

Leave a Reply

Your email address will not be published.