Debt consolidation loans are loans that assist you in merging multiple debts into a single repayment. It reduces interest rates, monthly repayments and overall payable amount. One can consolidate credit cards, payday loans, utilities or student loan debt.
A fixed-interest loan requires paying the amount in monthly instalments. These loans are ideal for individuals struggling to manage multiple debts as such. Consider it if the interest rates on the new loan are lower than the debts to consolidate.
It is available in secured and unsecured options. Secured debt consolidation loans are for individuals with good credit scores and finances. Choose the best option according to credit history, income and liabilities. One can either apply with the same loan provider or compare affordable options.
For example:
Therefore, you pay £1047.93 per month on this debt currently.
With Widelyfinance, you can merge your debts at the best interest rate of 10.19%. With this, you pay only £946.97/month.In this way, you save £100.96/month with interest savings of £1334.47 over a 4-year term.
Contact our loan experts now to understand how much you can save with debt consolidation.
A debt consolidation loan makes financial management a little easier. This is because dealing with different loan providers for monthly payments is challenging. It is time-consuming, from checking the total costs to setting direct debits.
In contrast, personalised and tailor-made loans grant you more free time than investing in organising your finances. It provides the freedom to reduce the total loan fee and pay the loan earlier than the previous arrangement. Here are other features of the loan for better understanding:
Get loans without detailed documentation
One may consolidate debts without detailed application filing or documentation. You may qualify just by filling out a 2-minute application form. We generally ask for basic information like- name, contact, email, amount requirements, and loan repayment tenure. After that, provide proof of fair affordability, like a salary slip/self-assessment/pension to get the loan.
Affordable but competitive interest rates
By consolidating debts to a new agreement, you fetch better interest rates. However, the interest rates may vary according to the affordability and credit score. Individuals with low credit scores may struggle to get competitive rates, but you may get here if your recent financial performance is satisfactory. However, you can get low interestwith an increased income and reduced liabilities.
You can get up to £50000 for your needs
Individuals looking to consolidate debts may get up to £50000. However, the amount one qualifies for depends on credit score, income, previous debts, liabilities, and the debts to consolidate. Merge only those debts that impact your credit score positively. We may help you choose them if you want expert assistance. It is possible to do this with a detailed analysis of your personal and business finances.
You can repay the dues just within 5 years
With a single repayment to make monthly, you can repay the loan in 5 years or less. Choose a loan term that comfortably meets your income, liabilities, and emergency savings. Do not extend it unnecessarily. If you can repay within 3 years, choose so.
No upfront costs to pay
We generally ask for loan establishment, loan closure, interest rates and penalty costs (if you miss payments). There are no upfront costs to worry about with us. With a transparent cost structure, there is no clue for confusion. If you are still confused, ask us without hesitation.
These loans are ideal to consolidate credit card debts. You can reduce the overall interest and total repayments on the credit cards. For example, if you have 3 credit cards with an interest rate of 22.99%, you can consolidate their payments. It will help you fetch low interest rates and repayments. Here is how:
| Loan aspects | Costs of 3 credit cards (values in £) |
Costs after consolidating 3 credit cards (values in £) |
|---|---|---|
| Principal | 25000 | 25000 |
| Interest | 20% | 10% |
| Payments | 2500 | 2291.67 |
| Term | 12 months | 12 months |
| Bill payment | 3 | 1 |
| interest | 5000 | 2500 |
You can see how consolidating 3 credit cards can save you £2500 drastically. Here are some other purposes that you can use debt consolidation loans for:
Settle small debts
You may have some short-term loans in your credit profile, such as quick loans, overdrafts, utility bills, etc. You can benefit from consolidation if you have pending payments for 5-6 months. Non-repayment impacts your credit score. Therefore, you can pay for unsecured loans for debt consolidation, with a single payment. It reduces your debt to nil, and your credit score jumps a few points.
Help businesses pay suppliers and employee wages
A well-structured business consolidation loan helps you re-organise the operations better. It utilises the existing money clocked in debts to meet important requirements. For example, you can consolidate the business debts to pay off suppliers and release payrolls.
A delay in payments may obstruct operations and impact business growth. You can consider it if you need money quickly without waiting for clients’ payments.
Pay off pending court judgements or CCJs
County Court Judgements (CCJs) are legal notices received after defaulting on a line. It impacts the credit score drastically. One may have over 5-6 CCJs in the credit profile. Whether you are a business or individual, you must settle this soon. Otherwise, it restricts one from fetching instant loans at better interest rates.
Options like personal loans for debt consolidation may help consolidate pending CCJ payments on debts like Christmas loans or unemployed loans.It improves an individual’s credit and reliability. However, the status remains on the report for 7 years.This is why a settled status helps fetch better loans.
You can get a debt consolidation loan with us for a poor credit history. We understand settling debts seems tricky with a low credit score. Hence, we provide the opportunity for individuals to qualify despite past credit issues. Individuals with stable income, responsible finances, no new debts, or bankruptcy may automatically qualify for these loans. To provide the loan, we prioritise an applicant’s payment potential, citizenship, and recent payment behaviour.
Other aspects may help you get a debt consolidation loan in the UK with a bad credit score. However, the conditions may be different according to the provider. This criterion is based on our perspective is as such:
Reveals signs of improved income
If your income increases after you take out the loans, we may help you get an affordable loan. However, you must provide relevant and authentic proof of income to benefit from the same.
Must have a low debt-to-income ratio
A debt-to-income ratio reveals the ratio of total debts to total income. Having a low ratio, like 30:70, may help you qualify easily. Income, debt management and reducing unnecessary expenses reduce the ratio. You may get a debt consolidation loan for bad credit in the UK from a direct lender like us. However, you must have significantly low debts to get better rates here. It reveals your credibility in maintaining payments on a new loan.
Utilise eligibility checker to understand payments
Eligibility checker helps one analyse the total loan costs, interest rates, monthly payments and other costs. You may use it to check whether you may qualify. You can do it yourself by using a loan calculator or eligibility checker.
However, we conduct a soft credit search to calculate that. It does not impact your credit score. For example:
If you borrow £30000 for 60 months at an interest rate of 6.1%, your loan costs may seem like this:
Monthly repayments = £612.31
Total amount to pay = £36,738
Analyse whether you can comfortably pay the total amount (£36,738). If your income is above £45000, you may get £30000.
With an income like £30000, you can borrow a low amount like £18000. This reduces your monthly instalment costs and total amount. You pay only £20,847 with a monthly repayment of £347.46.
Our loan experts have converted this into a table for better understanding:
| Aspects | Borrowing £30000 for debt consolidation |
Borrowing £18000 for debt consolidation |
|---|---|---|
| Interest rates | 6.1% | 6.1% |
| Monthly payments | £612.31 | £347.46 |
| Loan term | 60 months | 60 months |
| Total amount payable | £36,738 | £20,847 |
Additionally, missed payment penalties may increase the total amount to repay. Therefore, borrow a comfortable amount that does not affect your monthly repayments.
An improved credit score is a primary aspect of getting low-interest debt consolidation loans from us.You can do so by reducing current debts. Analyse the bills you can repay before consolidation. It could be small expenses like pending car repair costs, mobile recharge, etc.
Additionally, report the credit delinquencies that uplift your credit score. Here are other ways to get consolidation loans at affordable interest rates despite bad credit.
a. Ensure a recurring monthly income
Individuals with high and continuous monthly income may qualify for better interest rates. Analyse the ways to increase income by switching jobs or finding more part-time work. High income increases your payment potential and hence may fetch good rates.
Additionally, having a good income with responsible finance may benefit you in other ways. It may help you quickly get debt consolidation loans for bad credit in the UK with no guarantor especially from a direct lender. It grants one the opportunity to build and improve credit individually.
b. Pledge an asset as collateral
A secured debt consolidation loan requires one to provide an asset valuing to the amount you need. The cost of the item should be higher than the amount you need. Securing a loan against collateral helps you grab a loan at significantly lowinterest rates. You may also get a higher sum than without one at the platform. However, non-repayment or loan default may lead to asset seizure.
WE DO NOT RUSH TO CLAIM THE PRICY POSSESSION. INSTEAD, GRANTS YOU 30 DAYS PERIOD TO CLEAR THE DUES.
You must contact us if you miss a payment or two. We may help you with a suitable repayment tenure.
c. Apply jointly with someone
Individuals with poor credit history may benefit from joint loans. It helps one split the loan costs and qualify for better interest rates. It is possible if the loan partner has a consistent and high income. An income higher than yours may prove helpful. We analyse the credit copies of the borrower and the co-signer to decide the best amount you may qualify for.
Regular payments on joint loans for debt consolidation purposes help improve credit scores. However, if your partner cannot make payment, it may affect your credit scores. Avoid it by paying his share, too.
Note:A co-signer differs from a guarantor. A co-signer is equally responsible for the payments on the loan. However, a guarantor steps in only if the borrower can’t pay. Decide one according to your situation.
You must analyse a few aspects when applying for a debt consolidation loan for a low credit score. These parameters will help you improve your loan approval prospects better. For example, choosing a longer repayment period means paying more interest costs. Alternatively, short repayment tenure helps you save massively on costs.
Here are other aspects to check:
Check fixed or variable interest rates
Choosing a fixed-interest term is usually ideal for individuals with poor credit history. It helps you budget regardless of the economic changes. Alternatively, a variable-rate loan is ideal for individuals who want to benefit from flexible interest rates. Identify the impact of the same on your finances and decide right.
Select the debts to consolidate wisely
Analyse the debts with the highest monthly payments. It helps reduce the total debt amount drastically. For example, choose credit cards, overdrafts, and payday debts to consolidate first.
Check whether secured or unsecured loans for debt consolidation for bad credit may help you. Individuals require a good credit history to fetch better interest rates with secured loan. Alternatively, analyse the impact of missing payments on collateral-free loans.
Sometimes, unknown costs may increase the loan costs. However, we never hide anything related to the loan terms. Instead, we provide transparent conditions, fees, and additional costs before the loan is sanctioned. Additionally, we grant you sufficient time to go through the agreement.
Analyse the eligibility criteria
General debt consolidation loan eligibility criteria include permanent citizenship and a responsible financial structure. However, you may get a debt consolidation loan for less-than- perfect-credit with us if:
These are some primary conditions for consolidating debts for poor credit scores. Apply if you comply with these conditions.
With over 60000+ customers under the belt, we share the expertise to deliver excellence. We rationalise this by constantly analysing people’s expectations. It helps us review and launch the best customer-friendly lending standards. Here are other aspects that customers like about us:
The government of the country (UK and surrounding areas) provides the facility to individuals to deal with debts. It is primarily helpful for individuals facing debt relief orders, bankruptcy, Involuntary Arrangements (IVAs) or issues under Debt Arrangement Schemes by the Scottish government. For better guidance and financial solutions, you can consult us.
Responsible lending firms like Widelyfinance provide standardised loans to merge all your debts. It focuses on affordable lending with easy-to-understand terms and repayments. Individuals seeking a solution to manage their debts better may benefit from customised assistance and loans. You may contact us for immediate solutions to old or new debts.
Yes, it helps one organise debts better. Individuals with multiple debts like- credit cards, payday loans, overdrafts, no guarantor loans, bills, etc, may benefit from this. It reduces your monthly payments and interest rates. You just deal with a single person for all of your debts. It is the best way to save time and money clocked in several debts.
No. It is not mandatory to provide loan security. It is an option for individuals with poor credit scores seeking consolidation. You must provide an asset equalling the value of the loan amount. An asset-based loan helps you fetch low-interest rates despite poor credit history. You may get a higher amount than with an unsecured loan.
The interest rates one gets on debt consolidation depend on several factors. For example- income, credit score, financial history, loan repayment behaviour and economy. You may get a low-interest debt consolidation loan with a good credit score, high income and well-managed finances. Additionally, aspects like a guarantor or a co-signer may help you reduce the loan interest rates.
Yes, we provide these loans with same-day application approval. Aspects like quick credit screening, low documentation, and advanced technology catalyse the process. Existing customers may get the loan within 30 minutes. New customers may get one within 45 minutes respectively. However, provide a well-analysed application. Minimal mistakes can impact the loan turnaround timings.