Secured Loans
Debt Consolidation
Loans UK
Roll your credit cards, personal loans, and car finance into a single secured loan — one payment, one lender, and typically a significantly lower interest rate. Compare live rates from UK lenders now.
What is a debt consolidation loan?
A debt consolidation loan combines multiple debts — credit cards, personal loans, store cards, car finance, overdrafts — into a single new loan with one monthly payment and one interest rate.
A secured debt consolidation loan uses the equity in your home as security. Because the lender has that security, they can offer much lower interest rates than unsecured personal loans or credit cards — often 7–12% compared to 20–30% on credit cards.
This makes a secured consolidation loan particularly effective if you have significant high-interest credit card or personal loan debt and sufficient equity in your property.
Typical example
Estimated monthly saving
£335/mo
Illustrative example only. Your actual saving will depend on your circumstances and the rate you qualify for.
How it works
Use our free debt consolidation calculator — no credit check, no obligation.
Add your debts
Enter each debt — balance and current monthly payment. Credit cards, loans, car finance, overdrafts.
See your saving
We calculate what a single secured loan would cost and show your estimated monthly saving instantly.
Compare lenders
Your debt total loads into the rate table. Compare rates from our specialist UK lender panel side by side.
Apply in 60 seconds
Click Apply and an FCA-authorised adviser calls you to confirm your rate. No hard credit check at this stage.
Pros and cons
Benefits
Lower interest rate
Secured loans typically charge 6–12% vs 20–30% on credit cards — significantly reducing the interest you pay.
One monthly payment
Replace 4, 5 or more minimum payments with a single, predictable direct debit.
Fixed end date
Unlike revolving credit, a secured loan has a clear term — you know exactly when you will be debt-free.
Improves cash flow
Lower monthly outgoings free up income for savings, emergencies, or other priorities.
Risks to consider
Your home is at risk
Unsecured debts become secured against your property. Miss payments and the lender can repossess your home.
May cost more overall
A longer term means more total interest paid, even at a lower rate. Run the numbers before committing.
Fees apply
Arrangement fees (typically £495–£1,995) and valuation fees are common. These are disclosed upfront.
Doesn't fix the habit
Consolidating won't help if you run up the credit cards again. Consider closing accounts after consolidating.
Who qualifies?
To get a secured debt consolidation loan you must be a UK homeowner aged 18 or over with sufficient equity in your property. Most lenders require:
£5,000
Minimum loan
£500,000
Maximum loan
Up to 85%
Max combined LTV
Clean to adverse
Credit profile
Lenders consider your income, employment status, credit history, property value, and existing mortgage balance. Even with CCJs or defaults, specialist lenders on our panel — including Pepper Money and Together — may still be able to help.
Debt consolidation loans explained
How much could you save by consolidating?
The savings from debt consolidation depend on the gap between your current interest rates and the secured loan rate you qualify for. Most UK credit cards charge between 20% and 30% APR, while personal loans range from 6% to 15% depending on credit score. Overdrafts can cost up to 40% EAR.
A secured debt consolidation loan typically charges between 6% and 12% APR — significantly less than most unsecured debt. On £26,000 of credit card debt at an average of 22% APR, switching to a secured loan at 8% over 10 years could reduce your monthly outgoings from around £650 to approximately £315 — a saving of over £335 per month.
However, it is critical to consider the total cost, not just the monthly payment. A longer repayment term means you may pay more interest overall, even at a lower rate. Always compare the total amount repayable across different term lengths before committing. The MoneyHelper debt consolidation guide provides useful independent guidance on this.
Types of debt you can consolidate
A secured debt consolidation loan can be used to pay off most forms of unsecured borrowing, including:
Credit cards
Including store cards and charge cards. Often the most expensive debt to carry.
Personal loans
Unsecured bank or online lender loans with fixed monthly payments.
Car finance
HP, PCP, or personal contract hire agreements with remaining balances.
Overdrafts
Arranged and unarranged overdrafts, which can carry rates up to 40% EAR.
Payday loans
High-cost short-term borrowing — consolidating can dramatically reduce costs.
Buy now, pay later
Outstanding BNPL balances that are accruing interest or approaching deadlines.
You cannot consolidate your existing first charge mortgage into a secured loan. However, you may be able to remortgage if that is your goal. A secured consolidation loan sits alongside your existing mortgage as a second charge.
Secured vs unsecured debt consolidation
Both secured and unsecured loans can be used for debt consolidation, but they serve different needs:
| Factor | Secured loan | Unsecured loan |
|---|---|---|
| Typical APR | 6% – 12% | 6% – 30%+ |
| Max borrowing | Up to £500,000 | Up to £25,000 |
| Bad credit? | Widely available | Difficult / expensive |
| Property needed? | Yes — homeowner | No |
| Risk | Home at risk if you default | No property risk |
| Approval speed | 2–4 weeks | 1–3 days |
A secured consolidation loan is typically the better choice if you are a homeowner with significant unsecured debt (over £10,000), especially if your credit score limits your unsecured borrowing options. For smaller amounts with clean credit, an unsecured personal loan may be simpler and quicker.
Important considerations before consolidating
Debt consolidation can be a powerful tool for regaining control of your finances, but it is not a magic solution. Before proceeding, consider the following:
- You are converting unsecured debt into debt secured against your home. If you cannot keep up repayments, your home may be repossessed.
- A longer term reduces monthly payments but increases total interest. Run the numbers over multiple terms before deciding.
- Consolidating doesn't fix spending habits. If you continue using credit cards after consolidating, you could end up in a worse position. Consider closing accounts after paying them off.
- Arrangement fees (typically £495–£1,995) and valuation fees apply with most lenders. These are disclosed upfront and included in the APRC.
- Seek independent advice if you are unsure. The Money Advice Service (now MoneyHelper) and Citizens Advice offer free, impartial guidance on debt management options.
Common questions
What is a debt consolidation loan?
A debt consolidation loan combines multiple debts — credit cards, personal loans, store cards, car finance — into a single new loan with one monthly payment. A secured version uses your property as security, which typically unlocks lower rates than unsecured alternatives.
How much can I save by consolidating?
Savings depend on your current rates versus the secured loan rate you qualify for. Credit card debt at 20–30% APR consolidated into a secured loan at 7–10% can reduce monthly outgoings significantly. Use our calculator on the homepage to see your personal saving.
Is it a good idea?
It can be. You typically pay less interest and simplify multiple payments into one. But you are converting unsecured debt into debt secured against your home — if you miss payments, your home may be at risk. Always get independent advice if you are unsure.
Can I consolidate with bad credit?
Yes. Lenders including Pepper Money and Together specialise in applicants with CCJs, defaults, or missed payments. Rates will be higher than clean credit, but secured loans are often available where unsecured options are not.
What debts can I consolidate?
Credit cards, personal loans, store cards, overdrafts, car finance, and payday loans. You cannot consolidate an existing mortgage into a second charge loan — though remortgaging may be an option.
How much equity do I need?
Most lenders cap combined LTV at 80–85%. On a £300,000 property with a £150,000 mortgage, you may be able to borrow up to £105,000 (85% LTV) for debt consolidation.
See how much you could save
Add your debts to our free calculator and compare secured consolidation rates from UK lenders in minutes. No credit check. No obligation.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS.