CONSOLIDATE DEBTS AND CUT THE COSTS…

ABOVE: This is the most popular time of year for people to consolidate their debts

12th January 2010

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THIS is the most popular time of year for people to consolidate their debts, with three out of every five personal loans taken out last January for just that purpose.

Richard Napier, of Nationwide, said: “If you take out a personal loan to consolidate your existing credit card debts you may be able to cut your monthly outgoings and save interest.

“For those who have spent too much over Christmas and have several outstanding debts a personal loan at a highly competitive rate may be the best solution.

“Having one monthly fixed repayment helps you make the most of your hard-earned cash,” he said.

Average personal loan rates for borrowing £7,500 to £15,000 come in at 10.3% but the best advice is to check what your own bank or building society offers: many give a preferential rate to existing customers.

Best of the bunch is Nationwide. If you’re a FlexAccount holder then you can take advantage of its special loan interest rate of 7.6% if you borrow between £7,500 and £14,000 for up to five years.

The nearest competitor is Sainsbury’s with a loan interest rate of 7.9% but you must have a Nectar card to be qualify.

For details of the Nationwide loan, visit nationwide.co.uk (call 0800 302 010). For details of the Sainsbury’s loan, visit sainsburysfinance.co.uk (call 0800 169 8502).

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