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Should you consolidate your debts?

Consolidation almost always lowers the monthly payment. Whether it lowers what you repay in total is a different question, and it is the one that matters.

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The short answer

Consolidation replaces several debts with one, usually cutting the monthly payment and often raising the total interest because the term stretches. It works when the rate really falls, the term does not stretch far and you close the cleared accounts. Securing the debt on your home turns a credit problem into a repossession risk.

LowerWhat the monthly payment usually becomes
HigherWhat the total interest often becomes
Your homeWhat secured consolidation puts at risk
£0What free debt advice costs
What is on this page
  1. What consolidation does and does not do
  2. The same debt, three ways
  3. When it makes sense
  4. When it makes things worse
  5. Secured consolidation deserves real caution
  6. Cheaper things to try first

What consolidation does and does not do

Consolidation replaces several debts with one. The monthly payment usually falls. The total you repay often rises.

£12,000 across three cards at 22%, repaid over three years, costs roughly £4,500 in interest. The same £12,000 at 9% over ten years costs roughly £6,200. The monthly payment falls by about two thirds and the total is about £1,700 higher.

That is the trade every time. Lower monthly, longer term, more total interest. Whether that is a good deal depends entirely on why you are doing it.

The same debt, three ways

Route Rate Term Roughly what you repay in total
Leave it on three cards 22% 3 years About £16,500
Unsecured consolidation loan 9% 10 years About £18,200
Added to the mortgage 5% 20 years About £19,000
Debt management plan Interest often frozen Varies Closer to £12,000

An illustration on a £12,000 balance, not a quote. The monthly payment falls down the table while the total rises, and the last row is free through a charity.

When it makes sense

The rate really falls and the term does not stretchReplacing 24% card debt with a 9% loan over the same period saves real money.
You need breathing room for a defined reasonA temporary income drop with a known end date. A lower payment bridges it.
Multiple minimums are causing missed paymentsOne payment is easier to manage than five. Fewer missed payments is worth something on its own.
You will close the accountsConsolidation only works if the cleared cards stay cleared.

When it makes things worse

  • You keep the cards open and start using them again, which is the most common outcome
  • The new loan is secured on your home, turning unsecured debt into a repossession risk
  • The term stretches from three years to ten and the total interest rises sharply
  • There is an arrangement fee or early settlement charge that eats the saving
  • You could not get approved at a meaningfully lower rate, so you took a higher one
  • The underlying gap between income and outgoings has not changed

Want this checked against your own situation?

Send us the figures and we will tell you what they mean. If it is not ours to advise on, we will say who should.

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Free debt advice is available from StepChange, National Debtline and Citizens Advice. We are not paid to send you there. Talking to us costs nothing either, and there is no fee to you for anything we arrange.

Secured consolidation deserves real caution

A second charge loan or a remortgage to clear debt swaps an unsecured debt for one backed by your house.

The rate is lower because the lender can take the property. That is not a technicality, it is the whole reason the rate is lower.

If the debt is manageable and the plan is sound, it can work. If you are consolidating because you cannot cope, free debt advice comes first. Putting the house behind an unaffordable situation makes a bad position dangerous.

Free debt advice is available from StepChange, National Debtline and Citizens Advice. None of them charge, and none of them will judge you.

Cheaper things to try first

A 0% balance transfer

If your file allows

Moves card debt to 0% for a fixed period, usually with a transfer fee. Works only if you clear it inside the period.

Talking to creditors

Free, and underrated

Most lenders have hardship processes that can freeze interest. They will not offer unless you ask.

A debt management plan

Free through a charity

One payment, distributed to creditors, usually with interest frozen. It affects your credit file, and it does not risk your home.

Where you stand

It can work if
  • The interest rate really falls
  • The term does not stretch much further
  • You will close the accounts you clear
  • The reason is a defined, temporary income drop
Get free advice first if
  • You are borrowing to pay other borrowing
  • The new loan would be secured on your home
  • You have been declined for consolidation already
  • The gap between income and outgoings has not changed

Check broadband before you make an offer

Broadband speeds can vary street by street, so check the exact address before you commit. Ofcom's free checker shows which broadband speeds and mobile coverage are available at any UK property.

Want all your bills in one?

We can introduce you to a specialist who can combine your mobile, broadband and utilities into one bill. There's no fee for the introduction.

We don't provide these services ourselves. Switching household bills is not a regulated financial service, so FCA protections and the Financial Ombudsman do not apply. We'll only pass your details to the specialist if you ask us to. See our privacy notice.

Questions people actually ask

Is debt consolidation a good idea?
It helps if the rate really falls, the term does not stretch much and you close the cleared accounts. It hurts if the term doubles or the debt ends up secured on your home.
Does consolidation hurt my credit score?
A new application creates a hard search and a new account. Paying it on time then helps. The damage comes from missed payments, not from consolidating itself.
Should I consolidate debt onto my mortgage?
Only with free debt advice first. It lowers the payment and secures the debt against your home, which changes what happens if you cannot pay.
What is a 0% balance transfer?
Moving credit card debt to a card charging no interest for a set period, usually for a transfer fee. It works if you clear the balance before the period ends.
What if I cannot get approved for a consolidation loan?
That is often a signal the debt is beyond a lending solution. A free debt charity will give you options that do not involve borrowing more.
How do I check broadband speed at a property?
Use Ofcom's free broadband and mobile checker at checker.ofcom.org.uk. Enter the property's postcode and choose the address to see which broadband speeds and mobile coverage are available before you make an offer.

Where to go next

Debt help explainedThe options that do not involve borrowing.Debt consolidationHow we can and cannot help.Remortgaging explainedBefore you secure debt on the house.Budgeting and debtThe four numbers behind the decision.Credit score explainedWhat the application will see.Cannot pay a bill?If the pressure is immediate.
Where these figures come from

Figures checked on 1 September 2026 and correct for the 2026/27 tax year. Rates change, so check the source before you act on a number.

Written by Ben Tomlin. 1055079). We do not give regulated debt advice and we are not paid to refer you anywhere for it. The charities named on this page are free.

Last reviewed September 2026.

Weighing up consolidation?

Free debt advice comes first if the pressure is real. If it is a planning question, we are happy to talk it through.

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Prefer WhatsApp? Message us there. We are open Monday to Saturday, 9am to 8pm.

Free debt advice is available from StepChange, National Debtline and Citizens Advice. We are not paid to send you there. Talking to us costs nothing either, and there is no fee to you for anything we arrange.

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