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Debt Consolidation

Debt Consolidation could help you re-organise your debts into manageable monthly payments. However, if you are struggling to keep up with existing debt repayments, have missed payments, or if your credit rating is impacted, you might have difficulty obtaining a loan, nevermind one that is affordable. If you're struggling to get a loan, then Debt Consolidation might not be the right choice for you. A Debt Solution might be a possible alternative option.

At McCambridge Duffy, we offer debt advice and solutions that could help you address your financial difficulties in a way that is affordable. If you would like to know more about this, fill in the form below and one of our advisors will contact you to discuss your options. All advice is free, confidential and without obligation. We are an Insolvency company and do not offer loans or any form of credit.

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What is Debt Consolidation?

Debt Consolidation is the process of taking your unsecured debts and consolidating them into one monthly payment by means of obtaining a loan, leaving you with only one monthly bill to pay. For example, if you have credit cards, loans and overdrafts that you are finding difficult to manage, you could pay off the debts with a loan and make just one monthly payment instead of paying of 3 or 4 bills each month. You can use a personal unsecured loan or a secured loan (usually secured against an asset, such as your home) to pay off the debts in full.

In a loan you are replacing several forms of credit with another form of credit. You need to make sure you will qualify for a loan and also consider if you can afford the loan repayments each month for the duration of the loan. Shop around for the best deals available from the high street or online lenders. If you have a poor credit rating, you might not be able to obtain a loan, or you may only qualify for a loan with very high interest, which could cause problems with affordability. If this is the case, contact us to get advice on how you can address your debts.

Debt Consolidation Example

Debt Consolidation

Lets say you have debts consisting of credit cards, loans and an overdraft. The total of these debts comes to approx €10,000. You have many different monthly debt repayments of varying amounts which is becoming hard to manage. You feel like you are getting nowhere with paying off the debt and you are starting to struggle with meeting the monthly repayments because of the varied levels of interest.

You manage to obtain an unsecured loan of €10,000 with a low fixed interest rate over a set number of years. You use this loan to pay off all of the current debts. The interest rate on the loan is much lower than all of the combined interest on your multiple debts so this allows more money to go towards the actual repayment of the debt. Because you have a set period for the term of the loan and your monthly repayment is much lower and more manageable than your previous combined monthly debt repayments, you are able to manage the situation much more effectively. You also know an exact date of when you will have finished paying the loan in full.

Pros of Debt Consolidation

 It can be easier to manage

 You will have just 1 affordable monthly payment

 You will know exactly when you will be debt free

 Reduce high interest rates on your credit cards, store cards, overdrafts or loans.

cons of Debt Consolidation

 You may be subject to fees for arranging the loan

 If your credit rating is poor, you might not get a good interest rate on your loan

 If you obtain a secured loan to pay your debts off, and you miss payments on the loan, your home could be at risk.

 If you don't get a fixed rate on your loan, the interest could vary or increase during the loan term.

 Don't be fooled into thinking that you have cleared your debts. You have just shifted it to another form.

Should I consolidate my debt?

Knowing whether or not to consolidate debt is not a decision that should be entered into lightly. It might be right for your circumstances, but in some cases a different debt solution might be better. There are certain criteria you will need to meet in order to qualify for Debt Consolidation. It will also depend on the amount of creditors and outgoing bills you have as well as your overall debt amount. Some of the criteria that would qualify you for debt consolidation are as follows.

  • If you are having difficulty staying of top of your debts and making your debt payments to lots of different creditors.
  • You are confused with the varied amounts and levels of interest on all your debts and you would like one overall rate that is easy to understand.
  • You want to reduce your outgoing monthly bills.
  • You want to find an easier way to pay off all your debts and become debt free.
  • You have a relatively good credit rating where you can get a good rate of interest on your loan and a loan amount that will cover all of your current unsecured debts..

nb. *The suitability of consolidation also depends on the level of your debts. Sometimes there are better options for you such as debt management or a DSA (Debt Settlement Arrangement)..

Debt Consolidation FAQs

Below is a list of our most frequently asked questions relating to Debt Consolidation. If you have a question that isn't answered below click here to ask a question on WhatsApp.

This depends on exactly how much money you are paying and how long you want to repay the loan borrowed. It also depends on what interest rate you agree on your loan and whether or not it is fixed or variable rate. Reductions in monthly payments can be highly reduced with the right consolidation loan.

There are a variety of factors which dictate how much you can borrow on a loan. Whilst your income and, for secured loans, the equity available in your property are key, the main one is that you can afford to make the monthly repayments back into the loan. The lender must be confident that you can repay the debt.

This is usually up to you and will depend on how much you feel you can afford to pay each month. For example, you might want lower repayments spread out over a longer period of time if you are trying to get on top of your finances each month. Most loans are usually available for anything from 3 years up to 25 years, though some loans can be spread over a longer period of time, depending on your circumstances.

Certainly. Consolidating your existing debt allows you to free up money for other things. You can borow extra for other things, such as a new car or home improvements. The choice is yours. Just remember though, the loan is a debt and you will need to keep up repayments so do not over-borrow.

If you have illness or lose your job and cannot keep up repayments on your loan, this can cause some problems, the severity of which depends on whether your loan is secured or unsecured. You must consider this if you are applying for a loan. Some companies will arrange accident, sickness and unemployment cover if you want the added peace of mind this brings. Life assurance is also advisable. We would strongly advise that you consider very carefully before taking cover as it can be very costly to do so as some companies charge too much for this.

The answer to this question depends on the type of loan you have taken out and how much equity is in your home. If it is an unsecured loan, then yes, you may sell your home. If it is a secured loan against your home, then, providing you have equity in your home, you can use the proceeds of the sale to pay the outstanding balance of the loan. That is providing you are not subject to hefty early settlement charges, detailed in the loan agreement. Another option for a secured loan is to transfer the loan to the new property. This option may carry a fee and not all lenders will allow this.

There are several Debt Solutions available in Ireland that can help you address your debts. might offer an alternative way of addressing your debts, instead of consolidation.

Do you want to lower your monthly creditor payments?

Do you want to stop your creditors calling and harassing you?

Do you want a free and confidential advice on what debt solutions are available?

We, at McCambridge Duffy might be able to help. Call 01 539 57 90 now or get in touch by filling in the form on this page.

Other options for addressing debts

Debt Settlement Arrangement (DSA)

Debt Settlement Arrangement

A Debt Settlement Arrangement or DSA is a formal debt solution that can help you address your unaffordable unsecured debts, such as credit cards, loans, overdrafts etc...

In a DSA, you make affordable monthly payments towards the debts, usually for a period of 5 years (60 months). On successful completion, any remaining debts are written off and you can start over debt free. You will have complete protection from creditors, and interest and charges are halted as soon as your DSA is approved.

To find out more about how a DSA works, click the button below to read our DSA guide or click here and fill in the form on this page. One of our advisors will contact you with further information.

Personal Insolvency Arrangement (PIA)

Personal Insolvency Arrangement

A Personal Insolvency Arrangement or PIA is a formal debt solution that can help you address your unaffordable secured and unsecured debts. This includes unaffordable mortgage payments, arrears and restructures, as well as credit cards, loans, overdrafts etc... The main aim of a PIA is to help you remain in your home wherever possible.

In a PIA, your mortgage and debts can be restructed to allow for affordable repayments, usually for a period of up to 6 years (72 months). On successful completion, the secured debts are dealt with, as outlined in your arrangement and any remaining unsecured debts are written off.

To find out more about how a PIA works, click the button below to read our PIA guide or click here and fill in the form on this page. One of our advisors will contact you with further information.

Debt Relief Notice (DRN)

Debt Relief Notice

A Debt Relief Notice or DRN is a formal debt solution specifically designed to help people that are struggling with unsecured debts, up to €35,000 in total, who have little to no income left over each month and possess very minimal assets.

A DSA is sometimes referred to as a form of 'Mini-Bankruptcy' as it bears some similaritites. It usually lasts up to 3 years, after which the outstanding debts are written off, allowing you to start over debt free. There are specific criteria that will apply to determine if you are eligible for this type of solution.

To find out more about how a DRN works, click the button below to read our DRN guide or click here and fill in the form on this page. One of our advisors will contact you with further information.



Bankruptcy is a formal Insolvency procedure for people who are unable to repay their debts. It is usually considered as a last resort debt solution and you must have explored the other Insolvency solutions first, before taking the Bankruptcy route.

Going bankrupt could help you regain control over your debts. Bankruptcy usually lasts for about 1 year, but can remain in place for up to 3 years depending on your situation.

To find out more about how Bankruptcy works, click the button below to read our Bankruptcy guide or click here and fill in the form on this page. One of our advisors will contact you with further information.

Speak to us to see if you can reduce your debts

Call 01 539 57 90

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McCambridge Duffy Limited is a Limited Company registered in Ireland
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Registered office Suite 6, Spencer House, High Road, Letterkenny, Co. Donegal, F92 V8XC