The most common types of debt are:
Mortgage - For many people a mortgage is the largest loan they possess. Your home is at risk if you do not keep up repayments.
Credit Card Debt - Credit card debt is very common. This is due to the wide availability and ease of obtaining credit cards. They normally have the highest interest rate compared to other types of borrowing, making them the worse type of debt to get into.
Tax - This occurs when an individual has not paid tax such as income tax or council tax.
Catalogues/mail order - This is a very popular way of buying, even more so with the popularity of the Internet. The purchaser orders goods and is usually invoiced for the goods at a later date.
Hire Purchase - Hire purchase is where the purchaser agrees to pay an amount for a fixed term, until the cost of the goods has been paid for. Hire purchase is the term normally associated with buying a car through a finance company.
Personal Loan - Personal loans can be obtained through banks and building society's or through specialist loan companies. The amount of interest varies greatly so you should always shop around for the best deal to suit you.
Store cards - Most high street stores offer a store card where the holder can purchase items on credit and repay them later.
Debt Consolidation Explained contains general information only. We strongly advise you to seek qualified professional advice before taking any action.