Long terms - reducing monthly outgoings

Matrix_Keeper

To reduce monthly outgoings, I'm tempted to get an unsecured personal loan (most prob Northern Rock @ 5.6%) importantly without redemption penalty charge; then consolidate a credit card debt and an existing unsecured personal loan with Egg on an uncompetitive interest rate of 6.7% and stretch out as long as possible. Thus bringing monthly payments down.

Then, once I have some spare cash look to either pay off in full - or consolidate again at a later date on a shorter period of time way before the end of the term.

I know that Martin advises on shorter terms for personal loans to save on costs - but in the pursuit of bringing monthly spend down what do you all think of this strategy??

Look forward to hearing your thoughts.

Rafter

It all depends on your attitude to debt and to credit and how realistic it is that you will have 'spare cash' to pay it off.

Spreading debt accumulated on cards over a long period is bad news - do you really want to be paying for last years clothes, holidays etc in 5 years time?

6.7% from egg is not a bad rate - and it is flexible too. You may not get offered the market leading rate by Northern Rock unless your credit history is squeeky clean and you meet their profile.

Better to work out a proper budget to free up some money each month - only reschedule your debt as a last resort and please don't fill up your credit card again once paid off or you will be in even deeper.

R.

JBsplit

i understand what your saying i am very tempted to do the same,
i need to consolidate about 18k of various lending, even if i could get a 0%card for this the monthly payments would still be to high for me,so the only other option is a long loan to bring down the monthly payments.ive cut all the spending to a minimum and got the cheapest of every thing but i still need to reduce my monthly outgoings.

surly a long loan is all i can do.??