Virgin Money Debt Consolidation Loans

A debt consolidation loan could be a good option if you have lots of credit commitments and are finding it difficult to keep up with repayments. For example, you may owe money on more than one credit card, store card, overdraft or existing loan. With a debt consolidation loan, you borrow enough to pay off your existing debt and pay what you owe to one lender.

If you’re thinking of borrowing to sort out existing debt, it's important to consider your options before making a decision.

You might want to check out our 'dealing with debt' guide first.

If you’d like to talk to someone about money worries, please get in touch with our Financial Care team on 0800 141 2261.

Used carefully, a debt consolidation loan can help to make things easier. The benefits can include:

• Depending on the rate offered, you may pay a lower rate of interest than what you're currently paying. If you are eligible for a loan with a lower interest rate, this could save you money
• Making a single monthly repayment each month makes it easier to stay on top of what you owe, and reduces the risk of missing a payment. Keeping up with your repayments is a good way to protect your credit score
• Instead of owing money to multiple lenders, you'll only deal with one lender

With any loan, it's important to be aware of the full picture before making a decision. Here are some key things to be aware of if you're considering a debt consolidation loan:

• The interest rate on the loan you are offered may be higher than the interest charges on your current debts, so it's important to check this
• Make sure you are aware of any additional costs, such as early repayment fees on existing loans
• Depending on the types of debt you have, your overall monthly repayment might also increase if you consolidate a debt where you previously only paid interest (for example, on an overdraft). This is because you’ll now be paying off the original amount of the overdraft instead of just interest

After we have your loan agreement confirmed, we'll send your money. This will usually be within 2 hours or by the end of the next working day at the latest.

This does mean that there's a small chance you could be charged some interest before you receive your money. This is because interest is charged from the first day of your loan, not when it arrives in your account.

Credit scoring is how we decide whether you’re likely to pay the loan back. It’s based on your credit history, your income and the amount you spend each month. Essentially, it’s all about statistics: our scoring system allocates a certain number of points to the details you provide in your application, which is why it’s important to be absolutely accurate. We also look at your bank account(s) and ask a credit reference agency to create a historical report of your credit activities. The result is a score that helps us decide whether or not to lend to you.

So, we can work out whether you can afford the loan you’re asking for, we need to know:

• How much you earn, before tax, each year. You can include your salary plus any pensions, allowances, regular overtime or commission payments and any additional income from, for example, rentals or interest from investments.
• How much you spend each month on mortgage or rent, personal loans, credit cards and any hire purchase agreements.

We need to know about your income and expenses so we can work out whether you can afford the loan you’re asking for.

We need to know:

• How much you earn, before tax each year. You can include your salary plus any pensions, allowances, regular overtime or commission payments and any additional income for example any rental income
• How much you spend each month on mortgage or rent, personal loans, credit cards and any hire purchase agreements