- 17
- Apr
Those looking to manage their debt into a single consolidation loan are still experiencing financial difficulties, an industry expert has suggested.
According to Peter Tutton, social policy offer for Citizens Advice, an increasing number of consumers are signing up a debt consolidation loan when it may not actually be suitable for them.
He told the Observer: "There are problems with secured Consolidation Loans - we’re seeing lots of evidence that where people do get into [financial] trouble, they’re being pushed into consolidation."
"We’ve had cases where people have entered into secured loan agreements where [the payments] were not affordable from the outset," Mr Tutton added.
James Ketchell, spokesperson for the Consumer Credit Counselling Service (CCCS), added that although debt consolidation loans are popular, "interest rates are considerably lower on secured lending than unsecured".
However, he reminded borrowers that such loans are only a competitive solution "for five or six years".
An earlier CCCS study revealed that more than six million consumers had taken out a debt consolidation loan over the past three years.
Interfinancial providing you with breaking Debt Consolidation loans news.
