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If you're having financial problems, a debt consolidation loan can be a lifeline, potentially reducing your monthly outgoings.
Not only that, it should make managing your deficit easier because you'll only have one monthly repayment to think about.
What's more, if you apply for a loan that you find appealing and get rejected, this will leave a mark on credit files and lenders may use this to lower your credit scores further.
That's why it makes sense to make a soft search (which may be referred to as a 'smart search') for loans before applying.
While the repayment rates are likely to be more attractive you must always remember that your home or other asset is at a greater risk of repossession.Don't rule out unsecured loans - if the amount you owe is less than about £25,000, unsecured personal loan products may be a better option and many allow debt consolidation.Of the 126 unsecured personal loans analysed on Defaqto in December 2014, 83% allowed the loan to be used to consolidate debt.On 2 December, 2014, found that only 28% of the 126 unsecured personal loans listed on the matrix of independent financial researcher Defaqto had no fee for early redemption of the entire loan.Make a list of all your existing debt and check the small print, then factor any additional costs for repaying early into your sums.