Does debt consolidation include car loans?

Taking out a debt consolidation loan can give some borrowers a suitable way of simplifying their debts by reducing the number of different payments leaving their account, as well as taking some pressure off their monthly budget.

You can use a debt consolidation loan to pay off any type of debt you like (as long as the amount you borrow is large enough) - including any car loans you have. Just bear in mind that you may have to pay an early repayment charge on any existing debts you consolidate, which could cost you a fair bit overall.

Click here to find out more about debt consolidation loans.

How could a debt consolidation loan help me?

A debt consolidation loan could make the way you repay your debts from month to month more straightforward.

Consolidating your debts basically means combining them into a single loan - giving you just one payment per month to make to just one lender. So if you've found managing multiple payments to several lenders every month a bit more complicated than it needs to be, debt consolidation could be ideal.

You'll also be able to arrange payments you can afford - so if you want to take some pressure off your budget every month, you could agree to smaller payments over a longer period. Although this could cost you more in total once you've covered the interest, repaying the loan over a longer timeframe could help you free up a bit more cash for your other outgoings.

Finally, you should always get some professional advice before choosing a debt approach, so you can be confident it's the right step for you.

What types of debts can I consolidate?

As a general rule, when it comes to what debts you can include in a debt consolidation loan, it doesn't matter if your debts are unsecured/secured (but note that if you secure a debt consolidation loan against your home, your property could be repossessed if you fall behind with your payments).

As long as the terms of your original debts allow you to make a final payment to settle the debts in full, you should be able to include them in a consolidation loan.

You can find the answers to more common debt consolidation questions here.

Debt consolidation could help to make keeping on top of your debts that bit simpler - as long as you can keep up with regular payments until you've cleared the loan in full.

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Related resources

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Tags: debt, debt consolidation, debt consolidation calculator, unsecured debt, secured debt, mortgage

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