Credit cards
These can be an expensive way to borrow in the long term due to the high APRs (Annual Percentage Rates) that credit cards can often have.
Debt Consolidation Loans
You could receive your loan in as little as 3 days!
- Borrow from £10,000 to £250,000
- Flexible terms from 3-30 years
- Bad credit histories considered
- Self-employed, pension and benefit income
- Direct lender so no broker fees
Representative Example: A secured loan of £31,000 payable over 7 years on a fixed rate of 9.83% for the first 5 years, followed by a variable rate, currently 9.69%, would require 60 monthly payments of £553.17 followed by 24 monthly payments of £552.39. The total amount repayable would be £46,447.56. This includes interest, an arrangement fee of £1,999 and a processing fee of £499. The overall cost for comparison is 13.1% APRC representative.
What is a debt consolidation loan?
A debt consolidation loan is used to pay off one or multiple high interest debts and combine them into one loan.
Borrowers usually do this to make their debts easier to manage as it simplifies your repayments. Not only does it make it easier to manage, but it can also reduce the amount of interest you pay by having all of your debt in one place.
Borrowers can use their home as a security for a debt consolidation loan. Many borrowers take out a secured loan to consolidate their debt, as they tend to have a lower rate in comparison to an unsecured loan. This is because a secured loan uses your property as security and there is less risk.
This product is available as either a first or second charge mortgage, subject to eligibility and our lending criteria.
What type of debt can I pay off with a debt consolidation loan?
Personal loans
These can be unsecured loans that you may have taken out in the past to buy a car, go on holiday or make home improvements.
Overdraft
Some borrowers pay off their overdraft due to high interest rates their bank is charging.
How does debt consolidation work?
1. Look at your current data
Decide which debts you wish to consolidate and then calculate the total value of the loan you'll need in order to consolidate them.
2. Discuss your requirements
Your loan lender will then work out a monthly payment and loan term that meets your needs and circumstances.
The adviser will also look at whether it is appropriate to secure a previously unsecured loan and look at the costs associated with increasing the period over which the debt is to be repaid.
3. Consolidate your debt
When you have been approved for a loan, the lender will likely pay the creditors directly, so you won't have to do it yourself.
You will have a monthly payment until you have made all your payments over the loan term, unless you decide to settle your loan early and pay it off.
Can I get a debt consolidation loan with bad credit?
At Central Trust, we consider all credit histories, including defaults, CCJs, missed payments and those on debt management plans to offer debt consolidation loans with poor credit. These are however subject to our criteria and underwriting standards.
We consider all applications on an individual basis, so whatever your credit circumstances we will try our very best to help you.
Is debt consolidation a good idea?
There are different factors to consider before taking out a debt consolidation loan. Ultimately, it depends on your financial situation and whether or not it is the right option for you.
Pros
Fewer payments: Pay just one bill each month instead of many.
Lower interest: Get a better APR than credit cards or payday loans.
Simple tracking: Manage money owed in one spot instead of with many companies.
Better credit: Make single monthly payments on time to help raise your credit score.
Cons
Higher total interest: Paying a higher rate on the new loan means you pay more over time.
Longer repayment terms: Spreading payments out can increase cumulative costs.
Extra fees: New arrangement or early redemption charges may apply.
How much do debt consolidation loans cost?
Similar to other loans, the main costs of a debt consolidation loan are the fees and interest rate. However, the cost of a debt consolidation loan can also depend on various factors, including:
Loan amount
Loan amount will depend on the total amount of debt you want to consolidate.
Loan terms
Your monthly repayment will depend on how long you intend to borrow the money for.
Fees
Fees can include arrangement fees (also known as lender fees) and broker fees.
Early repayment charges
If you wish to repay the money you’ve borrowed back earlier than planned, an early repayment charge may stand. The amount depends on the lender, so it’s important to bear this in mind then agreeing to your loan.
Why choose Central Trust?
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Fast and Simple Process
You could access funds within days by calling our team directly or enquiring online.
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Over 35 Years’ Experience
We are one of the UK's longest established specialist lenders, so you can relax knowing you're dealing with an experienced team.
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Authorised and regulated by the FCA
We are committed to responsible lending, clear communications and good customer outcomes throughout the borrowing journey.
Your Loan,
Tailored for You.
Consolidating debt? Paying for a large expense like home improvement or a wedding? We have you covered.
Unlike many other lenders, there is no strict automation to our lending decisions. Your application is assessed by our team, not by a computer.
Stephen Stone
2 years ago
Incredible company. Empathetic and supportive staff that know how to offer customers a package that suits them. I was fed up with automated systems from the standard banks. This company talk to you and help you find something to suit your circumstances. I cant thank them enough for how they helped me
Greg Erasmus
3 years ago
When I contacted Central Trust I had a very strict deadline to make a payment. Jenny was extremely helpful and informative and got the process started straight away. The whole way through I was kept informed at every stage of my application and any hiccups was swiftly dealt with. I can't thank Jenny, Tara and Stephanie enough for their help and professional service. Highly recommend.
Edward Mawby
3 years ago
I originally left a review that said I was not satisfied with the service provided, however after being in touch with Tara I felt she tried her best to get the answer we wanted. Unfortunately it didn't work out, but she left us feeling optimistic that we can go back in a couple of months time to try again. Thank you for doing your best to help!
Anglela Ferrante
3 years ago
What an absolute delight of a company. Following setback created by the mini budget, I was left in a predicament, central trust came to the rescue and provided an excellent swiftly process. I would highly recommend using them. I dealt with Jenny who couldn’t of been more proactive and helpful.
Gwenda Squire
6 years ago
Really friendly, professional service. Completed within a matter of days. Would highly recommend
David Cutler
6 years ago
Mostly good, gave me the wrong return address for a form that needed a signature witness which meant the form was lost and I had to go through the hassle of finding a witness again. Asked me to send a settlement figure which they had already received from me and had acknowledged receipt. But on the whole much more efficient, faster and more communicative than the bank who I applied to borrow the money from.
Stuart Donald
6 years ago
Professional and pressure free from start to finish.
Tracy Mawson
6 years ago
Fantastic service from start to finish very efficient.
How it works
Organising your finances can sometimes feel stressful, but we want to make it as easy as possible for you.
In just 3 simple steps you could have the money in your bank account. All you need to do is:
Enquire
Complete our quick and easy online enquiry form. Alternatively, you can speak to an advisor instantly by calling us or starting a live chat.
Share
One of our qualified advisors will call you to discuss your enquiry and work out a monthly payment that meets your needs and circumstances.
Complete
We'll help you complete the paperwork and any other supporting documentation required. Everything can be completed electronically, or on paper if you prefer.
Ready to enquire?
Call an advisor free on:
0800 980 6273
- Friendly UK-based advisors
- Enquiring won't affect your credit rating
- Fast turnaround of 7-10 days is possible
- Immediate contact from our advisors
- We are a direct lender
Does getting a debt consolidation loan hurt your credit?
A soft credit search won’t affect your credit score. However, a hard credit search may have a temporary impact on your score. A hard search is usually carried out when you formally apply for a loan, rather than when you simply check your eligibility.
It’s also worth remembering that any impact from a hard search is typically temporary. Making your loan repayments on time and managing your credit responsibly can help your credit score recover over time.
What are the pros and cons of debt consolidation loans?
Rather than having multiple debts to repay, a debt consolidation loan combines your existing debts into a single monthly payment. This can make your finances easier to manage and, if the new monthly payment is lower than your previous repayments, could also give you more room in your monthly budget.
Having just one repayment each month may make it easier to keep up with payments on time, helping to protect your credit score. However, missing payments could still put you further behind and negatively affect your credit score.
Another potential drawback is that debt consolidation loans may come with additional fees and charges. A lower monthly payment does not necessarily mean you will pay less overall, particularly if the loan is repaid over a longer period. It is therefore important to consider the total cost of the loan, including interest, fees and charges, before applying.
What documents do I need for a debt consolidation loan?
The type of documentation you’ll need differs depending on your situation. However most lenders will initially ask you about the following:
- Proof of income
- Property information
- Credit history
Can I put all my debt into one loan?
Yes - this is possible. A debt consolidation loan can be used to combine all your existing debts into one, this includes credit cards or unsecured loans. This is however, dependent on how much you’re looking to raise and how much equity you have.
What credit score do I need for a debt consolidation loan?
This depends on the lender you apply with and what type of credit score they would be willing to accept. Unlike other lenders, we consider all credit histories. We understand that life happens and there’s more to your story than your credit score or your recent pay slip.
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