Find the best unsecured loans for people with a bad credit score

Whether you're a homeowner or tenant, have been declined elsewhere, have previous mortgage arrears, County Court Judgements (CCJ's), defaults, missed payments, been bankrupt or experienced other financial problems, fortunately there are some lenders who deal sympathetically with loan applicants who have a bad credit history.

Need to consolidate debts?

It's a fact of life that our finances sometimes get the better of us and leave us with that 'sinking feeling'. If you owe money for a car loan, an overdraft, a couple of credit cards and a store card, that's five separate debts and you may have found it hard work keeping track of your spending. One option is to consolidate all the debts by borrowing a lump sum to pay off all the individual debts, so that you've only got one payment to make each month. It may seem a bit odd to suggest trying to get an additional loan when you're already in it up to your eyeballs in debt, but as long as you realise that you're simply replacing multiple monthly payments to a number of companies with one lower, easier to manage repayment to one company.

Apart from making it easier to keep an eye on your spending, you should be able to save money by getting a debt consolidation loan at a much lower rate of interest than your current debts are costing you. The aim is to get a better deal so that you are freeing up as much money as possible to put towards paying off the debts.

Merging your debts by getting a personal loan at the lowest possible interest rate, or releasing some of the equity in your home with a remortgage can be a prudent course of action if you've already dealt with the primary reason why you're in debt in the first place. It would be foolish to take out a loan and then continue to overspend or take out more credit as this will simply exacerbate your problems.

It's extremely common for people to consolidate their debts and then to go on a spending spree using their newly cleared credit cards thus ending up in even more debt. It's important to not fall into that trap and make the mistake many others do.

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