Good Debt! Bad Debt!

An unsecured loan

An advance from an existing mortgage provider secured against property but leaving the original mortgage intact

A second charge mortgage (a loan secured on property, from a lender other than the existing mortgage provider, that leaves the first charge mortgage in place)

A re-mortgage (which will replace any pre-existing first charge mortgage)

Some debts are 'good'. Mortgages and student loans are good debts because firstly they have funded the purchase of a valuable asset (a home or education) and secondly because they are usually tax-deductible. Aside from loan-sharking (which you should, of course, NEVER consider!) running up debts on credit cards is the worst form of borrowing, as the interest rates are frankly usurious, and the card companies actively try to encourage you only to make the minimum payment, thus keeping you in debt for longer, and maximizing the amount of interest they suck from you. So debt consolidation can be a good deal.

So how do you choose a debt consolidation company? Ask your friends and family. Don't be embarrassed, many people end up in debt thru no fault of their own, and your family will probably be supportive. Never go with a company that wants your paycheck, and then sends you on a much smaller check - you are effectively handing over control to a third party here, and getting into control of your debt is an empowerment strategy, not a wimp out clause. Never agree to anything over the phone, and ALWAYS get the paperwork checked, even if just by your partner or sibling. They may spot something you missed. Stick with the big companies - even though their deals may look slightly less attractive, they won't try to screw you.

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Income For Life