A debt consolidation loan combines all of your debt payments into one. You can consolidate debt from credit cards, utilities, or consumer loans into a consolidation loan.
Debt consolidation loans may have a lower rate of interest, so this is a good option if you have outstanding debt at higher rates of interest such as credit cards. The advantage of a debt consolidation loan is organizing of all your debt into one loan so that you are only making one payment per month at a fixed rate of interest, for a specified period of time. It takes the guess work out of your debt payments.
In order to qualify for a debt consolidation loan you must have an appropriate credit rating and be able to meet monthly loan payments. You may also need to have someone co-sign your loan. To determine if a debt consolidation loan is right for you, please contact your bank or financial institution.