Your financial life comprises many ups and downs. Sometimes, situations are under control, but it lacks continuity. Besides, such things also affect your financial progress.
The best example of this uncertainty is when you are on multiple debts. You consume a lot of period shopping and use your credit cards to purchase anything. When paying credit card bills, you suddenly lack adequate savings in your account.
At the same time, you face another emergency, something like a medical urgency. Now, paying hospital bills is also compulsory. You call your friend or colleagues to pay the bill to have some money.
It points to you now having another debt to pay. With multiple debts to eliminate, your finances are imbalanced, and many problems are there to face. The consequences, like poor credit score, become apparent.
However, the lending market has a solution that can be effective. We are talking about debt consolidation loans for bad credit people in the UK. Yes, it is indeed the ideal way to have a sigh of relief when struggling with multiple debts.
Now, let us accept our conversation further on these loans.
What are Debt Consolidation Loans?
We first start by explaining what the loans are all about.
Debt consolidation loans are nothing but a form of personal loans. These are explicitly offered to merge all your debts into one loan and pay only one payment with a single interest rate.
It is a better option than making several payments, as this can be difficult to manage from your monthly earnings.
When you consolidate all your debts, you can take out a specific portion of the loan instalment from your monthly earnings. Doing this allows you to manage your expenses much more smoothly.
Some financial experts believe that going for these loans will add more to your pending debts. It may be true, but this loan is like a solution to your debt problem.
Therefore, you should go ahead with a positive mind and follow the tips below before opting for debt consolidation loans.
Vital Points to Consider on Debt Consolidation Loans
If you have decided to go for consolidation loans, here are some valuable suggestions to manage the loan accordingly.
Approach a Direct Lender, not the broker
The direct lending option is always more beneficial than going via the broker's way. There are many reasons to prove this. Some of them are noted below:-
F When you are in a financial emergency, approaching a broker will not bring instant results. Instead, opting for a direct lender is a time-saving process.
You will not pay extra fees when applying for debt consolidation loans for bad credit with no brokers. Only the interest rate is there to produce alongside the principal amount.
F You can have better communication with your loan provider. The broker is not there to intervene, and you can decide who to choose as your lender or not.
These pointers convey that direct lending is a more affordable and profitable option for these loans.
Compared with Government Loans
There is no denying the fact that government debt consolidation loans are there too. We are not proceeding to stop you from going for that option.
Still, we insist that you should make a comparison between private lenders and government-sponsored loans. It is a good practice and helps in making the right decision.
F When you compare them, you may find that direct lenders' loans for debt consolidation are more flexible than the government ones.
F You have a role in finalising the rates and repayment terms. On the other hand, you have to agree on the fixed terms and conditions of the government lending institutions.
F The interest rates of direct lenders' loans are more affordable than the mainstream lenders. Online lenders' criterion is that rates are decided according to individual capacity.
Thus, you need to make a comparison before making any decision.
Look for a deal where guaranteed approval can be possible
You want a loan because your finances are facing a debt emergency. Many pending bills are there to pay, and it is affecting your monthly income as well.
Indeed, you need a deal where there is a maximum chance of guaranteed debt consolidation loans. However, we clarify that providing a loan guarantee is not easy for lenders.
According to Financial Conduct Authority (FCA), no lender can guarantee the loan to the aspirant. It should be according to individual affordability. It is why reliable lenders like LoanOrganisation always offer affordable debt consolidation loans in any situation.
You have to make specific efforts to win the guaranteed approval. For example, you need to be good in your recent handling of all the payments.
Apply with no collateral to pay
You cannot take another risk at the expense of the existing one. Otherwise, it will be too much risky for your current scenario.
Therefore, we suggest you always opt for debt consolidation loans for bad credit in an unsecured way. Under this loan product, you are not liable to pledge the asset against the borrowing amount.
Instead, the approval comes on the capacity of your monthly income. It will be a riskless option, and your collateral will remain only yours.
Opt for no guarantor deal
Another ideal way to make the most of loans is to choose a no-guarantor deal.
Many trustworthy direct lenders in the UK, including LoanOrganisation, offer debt consolidation loans for bad credit with no guarantor. It is exceptionally effective in poor credit scenarios.
F When you do not include a guarantor, you repay the loan in your own capacity. It will be good for your credit score;
F You do not need to reveal how many debts to have to anyone. You can keep this information intact when applying solely.
Therefore, you must consider such crucial aspects before coming to any conclusion.
In the Nutshell
Debt consolidation loans for bad credit with no brokers, no guarantor, and collateral are beneficial on better terms than government institutions.
You only need to choose a reliable deal where the interest rates and repayments are affordable to your monthly earnings.
If you can do so, then you will indeed become debt-free. Isn't it good for you? Of course, yes.