Frequently Asked Questions
What is debt consolidation?
Debt consolidation is the practice of combining multiple debt obligations into one monthly payment. Think of it as rearranging your finances: rather than keeping track of multiple bills and payments, debt consolidation allows you to put all of your debts in one place with one simpler monthly payment.
How can I consolidate my debt?
Consolidation can be done in a variety of ways, but the most popular are:
- Consolidation through a debt resolution company
- Consolidation through a personal loan
- Consolidation through credit card balance transfers
Can debt consolidation save me money?
Depending on which debt consolidation method you choose, you may be able to save on interest costs and lower your monthly payment as well. However, most consolidation options cannot reduce your principal balance. Other consolidation options can reduce your total debt through direct creditor negotiation, often reducing both your principal balance and interest costs by as much as 50%.