Debt problems cause increase in consolidation levels

According to a recent report many people are deciding to turn to debt consolidation in a bid to try and reduce debt problems. In the past three years over 6.5 million people have consolidated their debts in order to ease financial strains, according to recent research.

It is though that well over one million borrowers have consolidated over £20,000 each, including smaller loans, credit cards, and store card debts. Younger peopled aged between 25 and 34 are most likely to turn to this solution according to research, with around 23% of borrowers in this age bracket having consolidated their debts.

One official stated: “Anyone who is juggling a range of debts with money owed on credit cards, store cards and loans should be acting to get their debts under control. It is encouraging that so many people have taken action as you can make significant savings by moving all your debts to one place.”

He also said: “With average standard credit card rates at 17.01 per cent compared to average unsecured loan rates of 8.44 per cent it is clear that borrowers can cut their monthly interest bill by moving. However it is crucial that borrowers see consolidation as a wake-up call to get debts under control. It shouldn’t be something you keep on doing simply to tide you over from year to year.”