debt consolidation loan with bad credit

Debt Consolidation Loan with Bad Credit

If you currently have a poor credit rating 580 or below, you might feel that money management with a debt consolidation loan could prove difficult. It is far easier to be approved for debt consolidation loans in the UK if you have a credit score which is classed as “fair” or above. This can help you to reduce the number of creditors you owe, and even reduce the amount of time it takes to pay off your overall debt.

Debt consolidation loans UK for bad or average credit

Credit ratings are the most common credit scoring models used by financiers to evaluate the credit worthiness of potential borrowers. Scores can vary between 300 and 850, and scores over 670 are considered good. Scores between 580 and 669 are considered “fair”, with anything lower than that being classed as “poor”.

However, it’s a common misconception that it’s impossible to consolidate your debt with a less-than-perfect credit score. It can still be done, even if you have been refused by the banks. With a little bit of determination, you will find that debt consolidation for paying off several credit cards or previous loans is achievable.

Consolidate your debts with a personal loan

The downside of having a poor credit rating is that any debt consolidation loans offered to you might have slightly higher interest rates than those you could access if you had an ideal credit score. However, there are several lenders who look beyond credit reports and focus on alternative data, such as job history, potential for earning and education to determine whether a person might be a good candidate for a consolidation loan.

Even if the interest rate offered on a debt consolidation loan is higher than you had anticipated, it’s worth sitting down and working out whether it could ultimately work for you. Even with interest, it’s possible that a loan could help you to pay off your creditors much quicker than you can under your current circumstances, which could mean that you could still save money (think about interest owed to one creditor vs interest owed to several).

For more information, you may find it useful to speak to a member of our team, who will be happy to advise you on what debt consolidation options are open to you.
At Debt Consolidation Loans, we help people get out of debt every day. For more information, contact us today for a quick chat, where one our team members are happy to help.

We offer Debt Consolidation Loans for homeowners.

Our team is on hand to help with number of questions you may have.

If you are struggling with debt, please visit Money Advice Service for help and advice.

We are a broker, not a lender.

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