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A debt consolidation loan is a type of loan that helps you merge some or all of your existing debts into one.
If you’re currently paying out for several different loans or credit cards, a debt consolidation loan could save you money every month in interest.
And with just one regular repayment, fixed for the life of the loan, it could make budgeting a lot easier, too.
To find out whether a debt consolidation loan is right for you, get your free personalised quote from us today. Don’t worry — getting a quote won’t affect your credit score.
Debt consolidation is about making things clear and simple. At Shawbrook, we offer unsecured personal loans that you can use to pay off existing debts.
You can borrow a little or a lot, with loans from £1,000 to £25,000. Plus, you can choose a timeframe that suits you. Our loan terms vary from one to seven years.
With Shawbrook, you’ll receive a fixed interest rate and monthly repayment plan from the start. So you’ll always know what’s what. We’ll give you a guaranteed – and personalised – rate when you apply for a quote. No surprises.
And as our debt consolidation loans are unsecured, they are not secured against any personal assets, such as your home, unlike a second charge mortgage. As a result, our loans could offer you more flexibility.
Debt consolidation may not be the best option for you if the rate of the new loan is higher than your existing combined debt. For more information on debt consolidation, read our ultimate guide.
One size doesn’t fit all. So when you apply, we’ll consider your personal circumstances. That’s particularly important if you’re self-employed, or have a non-standard address.
But we do have some basic criteria you’ll have to meet.
If your application is successful, we’ll also ask for your bank account details.
The rate you are offered for a debt consolidation loan will depend on your individual circumstances.
The interest rate offered will vary depending on our assessment of your financial circumstances and the amount you wish to borrow. That’s why you won’t find a loan calculator on our website. To find out more about this and our commitment to transparency, visit our guide on:
Representative Example: for comparison purposes, 14.9% APR Representative based on a loan of £10,000 repayable over 60 months with an interest rate of 14.9% p.a. (fixed). Monthly payment of £232.53 total amount repayable £13,951.80.
Our approach is based on good sense, honesty and clarity.
Shawbrook is proud to be a different kind of bank. Since 2011, we’ve quietly built our business by providing a select range of products for people who don’t always get the best deal from the big high-street banks.
We’re standing by to help with your application.
Call us on 0345 600 6260
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Debt consolidation is a way to combine some or all of your debts into one single monthly payment.
It means you could make one payment per month, rather than several. This can make it easier to keep track of all your payments.
With Shawbrook, this involves you taking out an unsecured loan which you use to pay off existing debts.
Other types of debt consolidation include a second charge mortgage or a balance transfer. A balance transfer refers to moving debt from one account or credit card to another.
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Debt consolidation can cause a temporary dip in your credit score but can improve your rating over time.
This is because being accepted for a loan will require what’s known as a ‘hard search’ – a type of credit check that will leave a record on your file which can lower your credit score and can be seen by other lenders.
But over time, debt consolidation loans may help to improve your credit score. That’s because having one monthly repayment can make it easier for you to pay on time, every time.
Receiving a quote for a debt consolidation loan from Shawbrook Bank won’t affect your credit score as the record, known as a ‘soft search’, isn’t visible to anybody but you. You will only impact your credit score if you apply for the loan.
Your circumstances will determine if a debt consolidation loan is right for you.
Taking out a debt consolidation loan could save you money in interest and make payments easier to manage.
With Shawbrook, you can choose a loan term that works for you. And we’ll give you a clear, guaranteed rate upfront so you can make an informed decision.
It’s important to be mindful that if you do choose a personal loan to consolidation your debts, it’s also possible that you could end paying more in interest, so please read the terms and conditions carefully and shop around for rates before making a final decision.
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Unsecured debt consolidation loans are loans which are not secured against any of your personal assets, such as your home or car.
Unsecured loans are typically for smaller amounts. Because they are riskier for lenders, they can be more expensive than secured loans. But at Shawbrook, we’ll give you a guaranteed rate when you apply for a quote so you can decide whether it’s right for you before you take out a loan.
In contrast, a secured debt consolidation loan is secured against personal assets or property. This may take the form of a second charge mortgage.
Otherwise, unsecured and secured debt consolidation loans work the same.
Payments on your debt consolidation loan are calculated by considering the amount of debt you wish to consolidate (how much you want to borrow), how long you want to borrow it for, and how much it will cost you to borrow this money including any fees (APR). A lender will use the annual representative rate (APR) on this sum to give you a fixed monthly payment over the duration of your loan.
Some lenders offer an online loan calculator to help you see what your repayments could look like if you chose to consolidate your debt with that specific lender.
But at Shawbrook, we don’t believe loan calculators accurately reflect the interest rate you’ll get when you apply for a loan. When you use a loan calculator, it’s often not based on the actual rate you’ll receive.
Instead of using loan calculators, we offer you a guaranteed rate through our quote tool. This provides a breakdown of your repayment costs based on the actual APR you’re eligible for. And don’t worry, applying for a quote will not affect your credit score.
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