Debt Consolidation through a Secured Loan
One of the most common reasons for individuals to take out secured loans is for debt consolidation.
Excessive amounts of credit card spending has become almost an epidemic in the UK, with many individuals owning several different credit cards, each one maxed out or over the limit. Credit card debt can be especially troublesome, as these are often the most expensive types of debt, with percentage fees that can go well over a 20% APR, and cost thousands more over time.
Similarly, student loans, overdraft fees, and several other credit sources can cause mountains of debt, with the average student owing over £8,666 according to the SIES, and adults averaging far more.
With so many different credit sources
Debt consolidation has become one of the primary uses for a secured loan. Rather than pay off these high interest rates, a secured loan allows the borrower to pay all of their debt sources off at once, and instead pay just one low interest payment to a single lender. This will dramatically reduce not only the amount of money you owe over time, but also the amount you have to pay each month.
You can also use the loan to pay for current expenses, and use the extra cash to make larger payments against your credit card debt, in order to wipe t he debt away quickly.
Here at SecuredLoansCompared.com, we make the process easier for you. Just fill out our form, and a specialist broker will contact you with quotations and comparisons from the top secured loan providers in the UK.