New research by Credit Action has revealed that a debt consolidation loan can lead to even worse financial trouble, if not handled in the correct way.
The report showed that some people are taking out a debt consolidation loan to pay off all of their smaller debts, but then failing to close other accounts and re-spending on them, placing them in an even higher level of debt than they were in before consolidating their finances.
Price comparison website uswitch.com commented on the report saying: "consumers need to take some personal responsibility and carefully manage their own financial situation."