What is a consolidation loan?
A consolidation loan is a way to bring all your current debts, including credit cards, overdrafts and existing loans together, into one loan, and one monthly repayment. They could help you to pay off credit cards and other debts sooner.
What are the different ways to pay off credit card debt?
If you have debts on an expensive credit card you may be looking at balance transfer cards. These allow you to switch your balance over to a new card with a lower interest rate. However, you may also have to pay a one-off fee to transfer the balance. You should also beware of promotional interest rates. If you cannot pay back the card in the promotional period the interest rate can sky-rocket after.
With our consolidation loans you can get a lower rate than most credit cards. The average UK Credit Card had an interest rate of 20.77% APR (2019). Our consolidation loans start at just 5.9% APR and you also won’t pay a transfer fee. This often makes a consolidation loan a cheaper option.
One simple repayment a month
By consolidating your debts you will also go from paying multiple repayments on different days throughout the month to just one repayment. This should make it easier to budget and plan ahead. Plus with London Mutual we have an even better way to repay which means you won’t need to remember when your payment is due…
Pay back all your debts from your salary
If you work for one of our Salary Deduction partners you can arrange to have one simple monthly repayment taken straight from your pay. This means you have the piece of mind that your loan is paid and you don’t need to worry about keeping money aside. Check if your employer is included here.
How do consolidation loans work?
1. Calculate your existing borrowing
Use our tool to calculate how much you owe across your credit cards, overdrafts and any other borrowing.
2. Apply for a consolidation loan
Based on how much you can afford to repay each month, we’ll estimate of how long it will take, and how much you could save in interest
3. Pay everything off
If you’re approved, we’ll ask you to provide details of your existing borrowing so we can pay off the card company on your behalf.
4. Repay from your salary
You’ll repay your consolidation via a single salary-deducted payment each month. No more sleepless nights, no hassle.
