A new research poll suggests that the rate people are using debt consolidation loans is rising more quickly in the UK than ever before. Sainsbury’s loans said that it estimates as much as thirty percent of all personal loans given between January and March 2012 are likely to be used for debt consolidation. They went on to say that it could be as many as 157,000 peronal loans and is worth as much as £1.5 billion.
Debt Consolidation Loans – the survey
The researcher found that an average debt consolidation loan would be in the region of £9,800, which suggests that the average amount borrowed for debt consolidation would be for that amount.
It shows that consumers are finding ways of reducing the underlying amount of debt they owe and are doing their utmost to get their monthly outgoings down. Although they have been praised for cutting their debt it also came with a warning, to shop around and do their sums before comitting to any debt consolidation loans as it is easy to be sucked into a deal which might not be as good as it first looks.
The Head of Sainsburiy’s Loans, Steven baille offered his advice to those contemplating a loan and said “For those who perhaps have balances on credit cards where they are no longer benefiting from an introductory offer or are paying a high interest rate on one or more store cards. Consolidating the debt could make a big difference by making it easier to budget monthly outgoings.
Anyone considering taking out a personal loan for this purpose should make sure they shop around and find the most competitive rate or reward package depending on their own individual requirements. Doing this could save considerable amounts on the total amount that you pay back.”
Debt Consolidation Loans – use common sense
It sounds like common sense to take a cautious approach to applying for a debt consolidation loan, however if you have a poor credit rating it is not always easy to get the best rate so it makes sense make a plan, then approach as many lenders as possible to find the most competitive rates. Try not to allow yourself to be sold too – rather than being pushed you need to make the right decision for yourself.
As always if you are looking for professional unbiased advice for debt consolidation loans or any other finance related questions contact your local citizens advice centre, there advice is free with no strings attached.
About Den NicholsonDen Nicholson is the senior editor here at Beating Bankruptcy, Since Den Retired from his UK business in the UK he has been blogging about ways of beating debt and in the most extreme cases beating bankruptcy. As well as detailed articles you can catch all the latest news from the UK with a focus on debt issues.
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