FAQs about consolidation loans
Can I pay off a debt consolidation loan early?
As with most loans, it is sometimes possible to repay the amount in full ahead of time. However, it’s important to remember that doing so may incur an Early Repayment Fee. This amount usually varies from lender to lender. Always check the terms of your loan before you apply.
Can I take a break from paying back my debt consolidation loan?
If you think you might need a break from repayments at any point, you should check the terms before applying. While some lenders do offer ‘payment holidays’ on loans for debt consolidation, these can show up as a negative on your credit report, so it’s important to get advice before you apply.
Do debt consolidation loans hurt your credit score?
Applying for any form of credit could mean a temporary decrease in your credit score, especially where multiple searches have been placed on your credit file. However, taking out a debt consolidation loan in particular doesn’t negatively impact your credit score. In fact, over time it could boost your score as you make repayments and prove your reliability as a borrower.
Just make sure not to miss repayments and keep on top of making payments regularly. If you're concerned about any negative implications, it's important to first seek advice from one of our experts.
Are debt consolidation loans a good idea?
Depending on the amount you owe to other lenders, a debt consolidation loan could be a big responsibility to take on. Some lenders use long term loans for debt consolidation in order to make monthly repayments more affordable.
However, provided you keep up with the repayments and refrain from further borrowing at this point, you should benefit from restructuring your outgoing payments – and potentially end up paying less money on interest in the long run, subject to the length of your repayment period and interest rate charged.
What’s more, repaying your loan over time can improve your credit score, leaving you in a better position to apply for credit at more favourable rates in the future.
What is an unsecured debt consolidation loan?
Unlike a secured loan, an unsecured debt consolidation loan isn’t linked to any property you hold. That means if you fall behind in payments, a lender won’t be able to take ownership of your property. Also known as a personal loan, debt consolidation without the risk of losing your property may be subject to higher rates instead.
Questions about our loans
We can give you the tools you need to better manage your financial situation, by offering a simple and flexible loan process. Our team can assist you in every way possible to ensure you get the repayment terms and interest rates that are best for you.
- How much can I borrow?
You can borrow anything from £3,000 to £500,000 when you choose Norton Finance and our trusted network of lenders.
- How long are the repayment terms?
Repayment terms vary between one and 30 years. They usually depend on your personal circumstances, including how much you borrow and the amount you can comfortably afford to pay back each month.
- What are the interest rates?
The interest rate you’re offered will depend on your individual money management history and current credit score. If you’re a homeowner, our secured loan rates start at 2.99%.
- Are there any loan fees?
We may charge a broker fee of up to 12.5% on all secured debt consolidation loans, capped at £3,995. We don’t charge fees on unsecured consolidation loans, as we receive a commission from the lender.