Consolidating a student loan

That loan would be used to help to pay off all of your debts and treat it as one debt, instead of several.

As a result, there would only be one monthly repayment to manage, rather than many.

The lender will look at your circumstances, the amount you want to borrow, how long you want to borrow for, and your credit score to help decide if your application will be approved or declined.

The smaller your debts and the better your credit rating, the more chance you have of getting a loan, so if there's anything you can do to improve your situation prior to applying then be sure to do so.

Representative example: Assumed borrowing of £7,500 over 36 months at a fixed rate of 3.4% per annum would result in a representative rate of 3.4% APR, monthly repayments of £219.26 and a total amount repayable of £7,893.36.

Representative example: Assumed borrowing of £7,500 over 36 months at a fixed rate of 4.0% per annum would result in a representative rate of 4.0% APR, monthly repayments of £221.19 and a total amount repayable of £7,962.84.

Read on to learn how debt consolidation loans can help you.

There are obviously risks in taking out any kind of credit product, but if you are already in debt, then taking out an additional loan can potentially have a much larger impact on your finances.

If you fall behind on your mortgage or debts secured against your home, it may be repossessed.

Representative example: Assumed borrowing of £7,500 over 36 months at a fixed rate of 2.9% per annum would result in a representative rate of 2.9% APR, monthly repayments of £217.65 and a total amount repayable of £7,835.40.

Representative example: Assumed borrowing of £7,500 over 36 months at a fixed rate of 3.0% per annum would result in a representative rate of 3.0% APR, monthly repayments of £217.97 and a total amount repayable of £7,846.92.

For some loans a broker fee of up to 12.5% may be added to the cost of the loan.

If you have debts, then borrowing more money might seem counterintuitive, but there are good reasons (as well as risks) for considering a debt consolidation loan.

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