When you live in the United Kingdom, you have the unique ability to be able to take out a debt consolidation loan to take care of the debt that is hanging over your head.  These loans are designed to keep you from having to file bankruptcy, a process that will damage your credit even more and keep you from being able to do things such as purchase a car or home, or even work in specific jobs.  Debt consolidation loans are similar to conventional secured loans but are designed for people who have credit problems, allowing them to consolidate some, if not all, of the debt into one monthly payment that should be lower than all of the payments they have previously been making. 

Debt consolidation loans are easier for people with poor credit to obtain.  The rates tend to be better than most of the other loans that are available, and some lenders will offer even lower repayment terms if they see that this is a debt consolidation loan as compared to a regular loan to purchase things.  There are many companies in the United Kingdom that specialize in debt consolidation loans, and as with conventional loans, you go to these companies and apply for them just like you would with any other lender.  All you need to bring with you are statements of your debt, proof of income, a stable residence and collateral if requested. 

Once you have received word that you have been approved for your loan, the consolidation can take place.  In some instances, your consolidation loan lender will process the payments to your old creditors on your behalf so that you do not need to worry about dealing with them ever again.  Some lenders, on the other hand, will issue you a line of credit or a check, making you responsible for paying off your debt.  In its own way, having the lender take care of paying your creditors on your behalf is the better option.  You won't be tempted to simply take the money you borrowed and blow it.  Once you have paid of your creditors, you are then able to move forward with your life. 

More often than not, debt consolidation loans are secured loans that require collateral for security of the loan.  Cars and property are the usual forms of collateral, but some lenders will accept other valuables.  This makes sure that the loan is repaid.  If you default on the loan, the lender has the legal right to repossess your property in lieu of the loan payment.  Most of the time the lender will work with you to get the loan caught up, because in the long rung it's more work for them to deal with your property than your cash.