If you’re already neck-deep in debt with interest rates piling up on top of your head from the multiple loans that you owe, it may be a good time for you to consider debt consolidation. Debt consolidation is the process of applying for a single loan amount that will cover the amount of all your separate debts. This means when you consolidate debt that you only have to deal with one company or creditor from the moment you sign up for a debt consolidation loan. You will only have to pay one interest rate that is likely lesser than all your multiple interest rates summed up.
Here’s how it works: Once you sign up with a debt consolidation company, they will deal with all your creditors. They will restructure your debt to make payments more manageable for you, and they will design it over a shorter span of time. This will allow you to quickly consolidate debt and get out of the financial rut that you are stuck in. Interest rates could also be lower since you only have one loan amount to pay as compared to multiple accounts at varied interest rates. You can also get free debt counseling and guidance on how to properly manage your financial assets.