Now that Christmas has passed once again and we enter the slight lull between Christmas and New Year, many individuals across the UK will be waking up bleary eyed and wondering what all the fuss and huge amount of build up was all about.

The next thought which is likely to hit many people is just how much they actually spent over the course of the festive season, on presents and celebrations and for some, this may not become fully apparent until they receive their credit card bill, or check their bank statement for January.

Although many individuals have made huge cut backs on their Christmas spending this year, others will still have depended on credit, such as overdrafts, credit cards and personal loans to cover the cost of the festive season, without taking into account the consequences of the additional loan repayments in January.

Worst of all, a growing number of borrowers have taken out expensive pay day loans, which will start charging extremely high levels of loan interest if they are not paid off within the first month of taking the loan out.

For many people who find themselves in the position where they are unable to manage all their loan and other debt repayments in the New Year, a debt consolidation loan may be a suitable solution to the problem.

A debt consolidation loan pools a person’s individual smaller loans and debts into one single larger loan with just one monthly repayment amount. This is often easier for someone to manage instead of many smaller repayments.

Although the monthly loan repayments on a debt consolidation loan are usually significantly cheaper than the previous debts, a borrower should ensure that they are only using the loan to repay more expensive debts and that the term of the new loan is not excessive compared with the original debts, as this could work out more expensive over the term of the loan.

The economic situation in the UK at the moment, with high inflation and low wages, is placing a huge strain on the finances of many individuals across the country, forcing many people to resort to personal loans and credit cards on a regular basis, just to cover their monthly expenditure.

As a result of this, many individuals are getting themselves deeper into loan and credit card debt, which they are unable to afford, thereby leaving them in a down hill spiral of loan debt, which will inevitably end up in loan arrears and a bad credit rating.

Whilst many people may bury their heads in the sand at this point, or seek out expensive debt management plans, one of the easiest and simplest solutions to freeing up extra disposable income is to take out a debt consolidation loan.

Although criteria for personal loans has become much tougher over the course of the past couple of years, there are still plenty of cheap loan deals available to those borrowers with a good credit rating, particularly if they shop around the loan market place. It is therefore important to look for a debt consolidation loan before any existing debts fall into arrears or have missed payments.

It is advisable to seek professional advice before taking out a debt consolidation loan, as this course of action could mean a borrower ends up paying far more in interest payments on their new loan over the term, than they would have done on their previous debts, even though the monthly loan repayments may be much lower.

Despite this warning, a debt consolidation loan can make the difference between a person managing their finances throughout the month without relying on additional credit, and falling into a spiral of loan debt which ends up in a bad credit rating and loan arrears.

Personal debt in the UK is a growing problem and many individuals are struggling to stay on top of their personal loan and credit card repayments, particularly when they are faced with high inflation and rapid increases in their monthly food and fuel bills.

The Office for Budget Responsibility (OBR) has predicted that the level of personal unsecured loan and credit card debt is likely to increase significantly over the course of the next couple of years or so, as many people take on additional loans and use their credit cards on a regular basis to pay for everyday items and bills.

Many people who are already finding difficulties in paying their loans and other debts are not able to make it through to their next pay day with just their salary alone and a growing number of people are taking out personal loans and in some cases, expensive doorstep loans or pay day loans in order to simply pay their outstanding bills.

This is clearly the worst thing to do if someone is already unable to manage their existing loan repayments, as the repayments on their new loan will only add to their monthly debt repayment burden.

By taking on additional loans and debt, particularly on high interest loans, borrowers are setting themselves on track for a down hill spiral of debt, which is likely to end in loan arrears, defaults and a damaged credit rating.

A debt consolidation loan can be an extremely useful tool for those with multiple debts, as a good cheap loan deal can often save a small fortune in interest payments over a term, as well as increasing monthly disposable income for the borrower.

However, someone taking on a debt consolidation loan must remember that their debt has only been transferred to a cheaper option and they should not take any additional loans on, or run up their credit card bills again.

It is a well known act that many individuals in the UK are struggling with unmanageable levels of personal loan and credit card debt, with loan repayments taking up a large proportion of household income in many cases. But just how are people repaying their loans and other debts?

The latest research from the debt charity, the Consumer Credit Counselling Service (CCCS), has found that the average individual who contacts them for help with their debts, typically owes around £22,476 on personal loans, credit cards, overdrafts and other unsecured debts.

Keeping up with these loan repayments costs the average borrower around £675.52 every month, an amount which many are simply unable to afford.

To place tis figure in perspective, a person who earn an average wage would have to work until 4pm on a Wednesday just to cover the cost of their weekly loan repayments, a situation which is clearly unmanageable when there are all the other household bills to be paid.

Many people are opting for debt management plans in order to take the pressure off their loan debt repayments, but these plans can be expensive and a recent investigation by the Office of Fair Trading (OFT), has found that in some cases, clients of these plans can actually end up in a worse position with their loan debts, than they were before they took the plan out.

One of the simplest solutions for someone who has a clean credit history, is to take out a debt consolidation loan, which pools all a person’s debts into one single monthly cheap loan repayment.

The best situation of course, is to avoid debt in the first place. Delroy Corinaldi of the CCCS said “With rising prices continuing to push up the cost of living, household budgets are under increasing pressure and these figures show how difficult it can be to escape from debt once it builds up.”

For people in the UK who may be struggling with the repayments on their personal loans and credit cards, there are various solutions available to them in order to reduce their repayments and get the equivalent of a cheap loan.

One option which is readily available to someone with a number of loan and card debts, is a debt consolidation loan, which can pool a number of debts into one low rate loan with a single monthly repayment.

An alternative to a debt consolidation loan, for those with credit card debts, could be a balance transfer credit card, which offers a reduced rate or zero per cent interest on the debt for a limited period, but usually with an initial transfer fee.

Over the course of the past couple of years, there has been a large increase in the number of balance transfer credit cards entering the market, with some increasingly attractive offers to compete with any cheap loan.

The number of balance transfer cards which offer zero per cent interest for at least 13 months has increased by around 162 per cent in the last two years and some of the best deals will allow interest free balances for up to 20 months.

On the down side, for someone with high levels of credit card debt, the new card may limit them to a maximum credit balance less that their outstanding debts. Also the debt has to be repaid in a relatively short period of time in order to avoid paying high interest charges on the card once again.

For larger levels of loan and card debt, a debt consolidation loan should still be a serious consideration, as there are plenty of cheap loan deals available on the market at the moment and the repayments can be spread out over a longer period than any balance transfer credit card.