There may have been one or two gifts in George Osborne’s Budget speech in July, not least of all a National Living Wage. But for many, it’s insufficient to offset the extortionate cost of living, along with a reduction in tax credits and a paralysing housing crisis. Needless to say, such obstacles to making ends meet each month means only a lucky few will have been able to escape the necessary claws of debt over their lifetimes.
Yet the difficulty, and ultimately the stress, takes hold in earnest when you find yourself juggling multiple debts.
Credit card debt in particular can be crippling, but having different lines of credit, with different APRs, and, perhaps most maddeningly of all, with different repayment dates, can leave you in a spin.
However, instead of fretting as money seeps away from your account, there is a simple step you can take to better manage your finances. Indeed, debt consolidation loans offer you the chance to take all your outstanding debts and pile them into one affordable, hassle-free bucket, leaving you with less to worry about and more money in your pocket.
The emergence of peer-to-peer lenders
The key, of course, is to find a suitable loan provider to fit the bill. After all, it would be a largely pointless exercise to consolidate your debt unless you get your hands on a loan with an improved APR!
So where in the diverse world of personal loans can this golden goose be found? In truth, there are numerous options, but one which has reared its head in the market is that of peer-to-peer lenders.
These online platforms match borrowers seeking a good-value loan directly with ordinary consumers, who opt to lend their money to real people rather than putting it into a savings account. This streamlined model, coupled with the efficient, red tape-free matching process, creates value to both borrower and lender (ie: borrower receives a competitive APR, while the lender gets a good return on their money) as it bypasses intermediaries like the bank.
All that’s required from your end is to go online, get a personalised loan quote in a matter of minutes, and complete the brief application process if happy with your quoted APR. Their credit underwriters will then analyse your credit history, and typically return a decision within one working day.
This means that, if approved, you can have the money in your account within 48 hours, leaving you in pole position to consolidate your debt almost straight away.
Do your homework too, as some offer additional benefits. At Lending Works, for example, you are given the flexibility to borrow an amount ranging from £1,000 to £25,000, and to choose the period over which you’d like to pay it back (1-5 years). In addition, you are given the opportunity to pay your loan back early – should you ever be in that position – at no extra cost.
Taking charge of your finances
We’ve all stumbled upon tough times, and getting stuck with high interest loans, or maxing out your credit card is not unusual. But it’s important to realise that you need not ever feel trapped in such a cycle, and that by taking control of your finances, you can work your way out of the stresses which come with debt.
Debt consolidation loans might just be your ticket to becoming debt free, so do your research, and find the best personal loan provider for you. However, you might just find that after doing so, the aforementioned ‘golden goose’ is a peer-to-peer lender.