Debt consolidation loans total ‘could approach £3bn by Easter’

Loans taken out for debt consolidation purposes could reach £2.93bn in the first quarter of 2009, according to Sainsbury’s Bank.

Figures from Sainsbury’s Finance state that as many as 250,000 personal loans are expected to be taken out for debt consolidation by Easter this year.

About a quarter of personal loans taken out today are for debt consolidation, according to the bank, with the average amount borrowed standing at around £12,000.

A spokesperson for debt management company Gregory Pennington said: “Debt consolidation loans can be a very useful way for people to repay their debts at a more manageable pace, or to simplify their finances in general – although borrowers should be aware that they may end up paying more in total if they repay debt more slowly.

“Of course, other debt solutions might be more appropriate for certain situations. Anyone looking to tackle their debts should speak to an expert debt adviser beforehand.”

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Gregory Pennington offer debt management plans as well as a range of other debt solutions. If you are struggling with debt, contact one of our expert debt advisers today.