Is Debt Consolidation A Good Idea? Everything You Need to Know

Debt consolidation can seem appealing with the promise of a significantly lower monthly payment and a reduced interest rate.

What Is Debt Consolidation?

Debt consolidation is the process of combining all of your debts into one single debt. If you have different loans out with varying rates of interest, the consolidation will give you one interest rate and one lender.

How Does Debt Consolidation Work?

Debt consolidation can stop the ballooning interest rates and fees of a payday loan. Debt consolidation does this by paying off your balance in full with another loan and restructures your debt that you will repay to another lender.

Ways To Get A Debt Consolidation Loan

Depending on your outstanding debt, you may be able to transfer all of your outstanding debt to a 0% interest credit card if the card limit is high enough.

Zero Percent (0%) Interest Cards

Ways To Get A Debt Consolidation Loan

This loan would cover all of the outstanding balances of the debt you would like to consolidate/combine. You would use the loan to pay off all the debts and make one single payment to your lender.

Private Loan To Consolidate Debt

Ways To Get A Debt Consolidation Loan

Many debt consolidation companies will handle all of the paperwork, refinancing, and debt payoffs for you as well. These companies will charge a fee that often gets rolled into the loan they provide.

Debt Consolidation Companies

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