DEBT CONSOLIDATION

Debt Consolidation simply means combining all of your debts into one loan.  People usually consolidate their loans when they are paying several loans with varying interest rates.

Consolidating your debt into one loan might help you to lower your interest rate hence you would be making smaller monthly payments or you might want to maintain the same payments thereby reducing your debt faster because a larger portion of your payment will be going towards paying off the principle rather than the interest.

Debt consolidation loans are usually administered by the loan provider that gave you the debt consolidation loan.  If you have attained the services of a debt consolidation agency who have negotiated with your creditors for a lower interest rate, then you will be making your payment to the agency which will distribute the monthly payments to your creditors.

Debt consolidation loans can be used to pay off many types of debts such as credit card debt and student loan debt.  There are several companies that offer debt consolidation loans so you should shop around to find one with a low interest rate.