Benefits of U.K debt consolidation loans

5 Benefits of U.K debt consolidation loans

One of the best things that you should do if you are overburdened with multiple credit card debts is to consolidate them. Consolidating your debts is certainly better than paying off multiple creditors. In the U.K, the best way of consolidating your unsecured debts is to obtain a debt consolidation loan. Other than debt consolidation loan, a debt consolidation program can also help you pay off your debts in affordable monthly payments. Debt consolidation is quite common in the UK and it has been considered as the best way to resolve your debt issues. Have a look at the 5 benefits of UK debt consolidation loans.

1. Single monthly payment:
The process of a debt consolidation loan involves taking out one loan in order to pay off all your other loans. Most debtors in the U.K have multiple credit cards and have huge balances on each of them. By using a debt consolidation loan, you can consolidate all you debts into a single monthly payment. Instead of multiple accounts and multiple deadlines, now you just have to concentrate on one single debt account. Collect all your savings and put it into this single debt account. Your debt consultant will disburse this account to your creditors.

2. Reduces interest rate:
A debt consolidation loan, like a debt consolidation program, reduces your interest rate on your loan. Credit cards generally have the highest interest rate and that is the main reason why credit card debts are the most common form of debt in the UK. By utilizing a debt consolidation loan, you can save a considerable amount of money as you have to pay lower interest rate over the life of the loan.

3. Stops collection calls:
If you take a debt consolidation loan, you can easily pay off your debt with affordable monthly payments. Therefore if your creditor is satisfied with your payments, then he will not turn your account to collection agencies. This waives off the possibility of harassing creditor calls. These calls can be stressful and annoying. Taking out a consolidation loan will help you to get rid of collection calls.

4. Protects your credit score:
Paying off your debts by taking a debt consolidation loan often protects your credit score. Generally failure to make your credit card payments on time hurts your credit score. So, as you are now making timely and regular payments with the debt consolidation loan, your credit score will not be hurt to that extent.

5. Reduces stress:
Debtors who are overburdened with huge credit card debts are always in stress. Nothing can be more stressful than not being able to pay off your debts. So, a debt consolidation loan can reduce this unnecessary stress by helping you with your monthly payments.

Before taking a debt consolidation loan, it is very important to shop for debt consolidation quotes. Other than consolidation loans, a debt consolidation program can also help you with paying off your debts systematically and lead a debt-free life.

Face your debt fears!

Acknowledging that your debts have become uncontrollable is the first step in facing your debt fears. Studies show that many people wait at least a year before confronting the problem, and even then it usually takes harassment from debt collectors to kick start people into actually taking action. If you have finally decided to take control of your financial obligations then confronting your debt problems will be the first point of call.

Don’t hide from Debt

There are many reasons why people put off dealing with debt until the last minute. Some hope that the problem will simply disappear and debt collectors will stop calling if they are ignored for long enough. Others simply cannot face the prospect of asking for financial advice and help when it comes to their personal finances. The humiliation factor is also an issue for some people; they are not able to control their debts and are under the impression that people will think badly of them.

Debt collectors will not stop calling if you do not answer the phone, they will simply use other methods to contact you. Asking for help with a debt problem is not a sign of weakness and is the best way to tackle growing debt problems. With household debts in the UK now reaching over £1 trillion, and debt counselling services receiving thousands of calls per week, you are definitely not alone with regards to this problem and there is no need to feel embarrassed.

Slipping into Debt

It has never been easier for people to slide into debt. Credit cards, loans, hire purchase and overdrafts are seen as a way of simply surviving in today’s society. But it only takes a few missed payments for interest to start building up at a frightening pace. It does not take long to get to the point where you are simply paying interest and not making a dent in the original loan.

Taking out other credit cards or loans to pay for the original ones will only add to your debts in the long run, and the debt cycle will continue.

Make a Plan

Making a plan may seem like too little too late but it is the best way of actually seeing where your money is going. Facing your debt fears means being completely honest about your spending habits, listing all your incomings and all of your outgoings. Denial and excuses are no longer an option, and only by being honest can you take responsibility for your debts.

Don’t Hide from the Phone

Do not hide from phone calls from creditors or debt collectors. Creditors and collectors only have so many rights; they cannot legally threaten you or simply turn up at your door without your permission. At this point there may be a solution to your debt problems via payment instalments at a reduced rate or with the interest stopped. Explain realistically how much you can afford to pay each month, if they accept then make sure you stick to these payments.

Take Responsibility for your Problems

It may not be an appealing idea, but contacting your creditors before they start calling you is a wise move. Make them aware you are taking your debt problems seriously and are tackling the problem. If it gets to the point of debt collectors then you will also have additional collector’s fees to pay. There is nothing to be lost by contacting your creditors first to sort out the problem; it may mean the difference between another sleepless night or a weight lifted from your shoulders.

Seeking Debt Help

Each year thousands of people seek help from credit counselling agencies. Agencies will be able to offer a personal plan and discuss your options. They will also be able to contact creditors on your behalf or arrange consolidation, if this is an option. Some agencies may charge a fee for their services and some government run agencies will be free. Always avoid agencies that offer large loans with high interest rates to pay off your debts.

Cutting Back

If you are facing your debt fears and seriously want to change your spending habits then a change in your lifestyle may be needed. Take a look at ways to cut back on household purchases and luxury spending. Consider maximising your income with extra work. Spend with cash instead of credit cards, and if you can, pay off credit cards by paying more than the minimum amount each month. Do not try and maintain a lifestyle that is beyond your means, persisting in this will simply drag you deeper into debt.

Facing your debt fears and admitting there is a problem will take courage and a reduction in your spending. But it is the first step towards becoming debt free and placing financial control back in your own hands rather than the lenders.

Can you live without debt?

Having debt isn’t compulsory, and many people can live their lives quite happily without credit cards and loans. There really is no need to fall into the debt trap, and living without debts should be the norm not the exception.

Britain Drowning In Debt, the Statistics

The personal debt statistics for the UK paints quite a picture. The average household debt in the UK now stands at £57,915 and the Citizen’s Advice Bureau deals with 9,562 new debt problems every day. It seems that Brits are addicted to debt, with many people achieving high levels of debt from an early age. Students in the UK leave university with an average of £23,500 worth of debt, and credit cards can be obtained at the age of 18. With statistics such as these it is no surprise that someone is declared bankrupt or insolvent in the UK every 51 seconds.

Peer Pressure Can Lead to Debt

A new statistic that is causing concern is the fact that one in five young people get into debt to keep up with more affluent friends. The peer pressure factor combined with the ‘buy now pay later’ philosophy is causing young people to sink into debt at an early age. Rather than recognising the dangers of debt, some young people are simply diving in and borrowing as much as they can with little thought for the consequences. More and more young people are finding themselves with serious debt problems and poor credit records thanks to the culture of buying on credit.

Can You Live Without Debt?

Many people will claim that it is impossible to make your way through life without debt. In some cases debt may be the sensible option, such as mortgages versus renting. But there is a difference between sensible borrowing and simply borrowing for the sake of it. It may seem like everyone else manages to make debt work for them but the statistics show otherwise. Having a minimum amount of debt is a much wiser option to reckless borrowing and spending on high interest credit cards. In the long run, the person without credit cards and loans is saving money and building towards a less stressful financial life.

Reasons Not to Build Up Debts

Anyone who has suffered serious debt problems will be able to give a list of reasons against getting into debt. Reasons not to build unmanageable debts will include:

* Constantly struggling to make ends meet every month
* Continual harassment from debt collectors and credit companies at home and at the workplace
* Continually borrowing money from friends and family
* Missing out on opportunities due to lack of funds being paid to creditors
* A poor credit record that will seriously hamper the inability receive normal credit rates
* Paying massive amounts of money in interest fees to creditors and not having disposable personal income
* Being seen as having the inability to manage money
* The inability to open normal bank accounts due to poor credit records

No Debts Means No Debt Related Stress

Debt related stress is a very real by-product of having serious debts. Debt stress can lead to constantly worrying about debts and can make every day a struggle. It can affect personal and work relationships and can lead to very serious mental and physical illnesses. Debt related stress will not be mentioned in the credit advertisements or in the credit contract’s small print. Having zero or manageable amounts of debt will mean having one less thing to worry about.

Leading a Debt Free Life

A debt free life can be achieved; it should simply take will power and good financial sense. Using facilities such as debit cards and even pre-paid credit cards is the way to stop paying interest to creditors. Consider the positive aspects of not being in debt, one of which will be an ability to exert financial control. Staying debt free means that facing a financially difficult period should be a lot easier if there is a sudden or prolonged drop in income. Take the view that those with zero or low debts are financially astute enough to forgo paying vast amounts of money in interest payments to creditors.

The choice between living a debt free life and coping with debts can significantly alter a person’s future and lifestyle. No one can be forced to amass vast amounts of debt; it is a matter of choice. Individuals do not usually follow the herd but show the way by example. The rewards of not following the seemingly easy credit route will be evident in the long run.

Debt could be prevented with financial education

A Confused.com debt commentator has suggested financial education in schools could help future generations avoid money troubles.

Spokesperson for the comparison site Zoe Stevens described how some people need to borrow money on an everyday basis, but it is important that they understand the repayment process.

In her view, individuals will find managing their money easier if they are taught more about the products they are using or will utilise in the future.

These comments were made after an Equifax survey found that 94 per cent of parents believe that financial education should be made part of the national curriculum.

The Confused.com debt expert remarked: "Starting this at a young age will ensure that as they grow up, children are able to make sense of what can seem like complicated financial products."

She also noted that the organisation is calling for greater clarity on the terms of so-called payday loans, since many people are signing up for them without comprehending what they are committing themselves to.

New Mum's dilemma going back to work due to debt

More than half of new mothers return to work due to financial pressures, a survey finds, with 56% admitting they were unprepared for the fiscal impact of having a child.
New mothers are being forced back to work by debt and financial worries, with many cutting short their maternity leave, according to research published today.
In contrast to the image of modern mothers "having it all", more than half (52%) of those returning to work after the birth of a child do so because of financial constraints, and one in 10 are doing so before the end of their planned maternity leave.
Only 22% choose to return because they want to continue their career, the survey by comparison website uSwitch found.
It found that the average net household income drops by 34% from £3,431 to £2,266 a month while on statutory maternity pay. But at the same time costs soar, with parents spending an average of £2,152 in the run up to the birth on baby items, and a further £2,521 – more than a month's reduced net household income – after the baby is born.
The average amount saved in anticipation of having a baby is £3,265, but 56% of the 1,000 mums questioned for the survey said they were not fully prepared for the impact of surviving on a reduced income.
Nearly a third of new mums were not aware of their company's maternity package when they decided to have a baby, and 30% decided to go ahead with getting pregnant even though the package was not ideal.
More than four in 10 mums have ended up in debt while on maternity leave, with an average £1,329 incurred.
However, although the financial impact forced 9% back to work early and another 9% to rethink their plans to be a stay-at-home mum, 40% take a pay-cut so they can work part time.
Worryingly, just 21% of new mothers returning to work believed their future progression and earning capacity had been unaffected by their maternity break.
Ann Robinson, consumer policy director at uSwitch, said: "Debt and financial considerations combine to be the biggest motivating factor behind new mothers returning to the workplace. Despite women being told that they can 'have it all' and can choose whether to be a working or stay-at-home mum, the fact is that most have this choice stripped away from them by the financial realities of modern life.
"With the new government planning to cut child trust funds and the impending budget causing concerns over pay freezes and redundancies, family finances are under more pressure than ever. The high cost of living coupled with the often crippling cost of a mortgage means that many households today need two incomes to get by. Unfortunately, new mothers are often paying the price for this by seeing their choices taken away."
If you’re a new mother and struggling in debt, visit DebtLine-Direct.com today and let us help you get your finances back under control.

Bad Credit Loans

* Bad credit loans are heavily advertised online, in the newspapers / magazines and also on television.
* Have you been refused for a bad credit loan or still trying to find out if they actually exist?

These bad credit loans carry very high interest rates and do not come at an affordable rate for the people that tend to be applying for them.

The companies offering the bad credit loans are very aware, just how vulnerable most of the consumers are that approach them for this type of lending or credit.

If you're struggling with your finances and want to consolidate your debts, visit; DebtLine-Direct.com for advice.

What IS a County Court Judgement?

County Court Judgement - CCJ - CCJ's

"At some point in our lives, we all struggle with our finances, sometimes resulting in a CCJ."

How did I get a CCJ?

CCJ's and defaults are registered on your credit file against you for the following 2 main reasons.


1: If you are late or fail to repay any unsecured debts

2: If you ignore debt collection requests

Your original creditor or lender will pass any account that remains unpaid to a debt collector of their choice. These collectors are usually working for the lender on a number of cases.

There are laws and guidelines that creditors must follow to compliantly recover the funds outstanding from you.

Because of your rights under the Data Protection Act 1998 and the Consumer Credit Act 1974, it is possible for you to check your credit files yourself by contacting one of the main credit agencies, who, for a fee of just a few pounds, will give you details of all your credit details. The two main credit reference agencies are Experian and Equifax.

Does a CCJ have long term effects?

A default is registered prior to any debt collection company being notified and then the collection company steps in to recover the defaulted funds.

If you fail to make an arrangement with either the creditor or respective debt collector, you can be forced into a court action which can then result in a County Court Judgement known as a CCJ being registered against your credit file.

This CCJ is then available for other lenders to see prior to agreeing to lend you any more money. A CCJ will show up on future credit checks. You will find that in most cases a CCJ or default can and will prevent an individual from obtaining further credit. We offer debt help and advice daily to people with defaults or a CCJ.

A CCJ or default will remain on your credit file for a period of 6 years and can have serious detrimental affects on you obtaining credit at an affordable repayment rate.

What can I do about a CCJ being held on my credit file?>

There are ways to return your credit rating to pre CCJ status.

A CCJ can be legally removed from your credit records in just a few short days or weeks if incorrectly lodged, enabling you to secure the loans or goods you need.

If you would like advice or help with CCJs then call Best Solution's free debt helpline now on 0800 933 6666.

Their lines are open 24 hours a day, 7 days a week and your call is free.