According to Which?, a cheap way of borrowing money is to take out an unsecured personal loan, as they often have some of the lowest interest rates on the personal credit market.
As well as being a good source of finance over a long period, unsecured loans have the additional benefit of not being borrowed against a property. In fact, Which? said that using a house to secure a loan is “a last resort”.
Malcolm Coles, from the magazine, said: “Many of us will have overspent over the festive period, or be planning large purchases in the January sales, so it’s a good time to sort out our finances.
“It’s really important to shop around to make sure that you get the best deal on credit.”
According to a survey by Alliance & Leicester, nine per cent of respondents said they are considering taking out a low-rate loan this year in order to tackle their debts.