What Is Debt Consolidation?
It's well known that over the last decade or so the citizens of the UK have built up unprecedented levels of personal debt. Soaring house prices have meant both higher levels of mortgage borrowing, but also a rising sense of affluence as homeowners have seen the value of their assets rise, often leading to more borrowing in the form of secured loans or credit cards.
Rising Financial Problems
This explosion in debt is now starting to hit home in many cases, with millions of people finding that times are getting harder and debt more difficult to keep up with.
Consolidation as a Solution
Debt consolidation is one popular solution to financial problems, seeking as it does to both simplify complicated financial situations and lower the amount of money needing to be repaid each month.
The basic idea is to pay off all your existing debts by borrowing funds from elsewhere at a lower cost than the interest you're paying now. The various ways of doing this are explored elsewhere on this site, but the ultimate outcome should be less repayments to make each month, both in number and amount, less stress, and more financial freedom.
The Downsides to Consolidation
Consolidation can also go badly wrong too, and so we will also take a look at how best to carry it out, and the pitfalls to avoid
Site is for information only and does not constitute personalised financial advice. E&OE.
