What is Debt Consolidation?

What is Debt Consolidation?

Debt consolidation is when multiple debts with different interest rates are combined into one monthly payment with a lower interest rate. If you find yourself having multiple debts, and it seems to be an unmanageable situation, debt consolidation may be something for you to consider.

Advantages of Debt Consolidation

The obvious advantage of debt consolidation is that it helps you get on top of your debt and it helps you avoid damaging your credit and missing payments.

Debt consolidation does this by giving you one payment and that your interest rate will be lower. Instead of having to juggle multiple payments, you will only have to worry about one debt payment a month. Also, the lower interest rate can help you pay off your debt quicker because more money is going to the debt itself and not just the interest rate.

Other things to Consider with Debt Consolidation

Debt consolidation can be a great way to help you pay off your debts, but it doesn’t really solve the problem of how you got into debt in the first place.  You may be able to work your way out of debt with debt consolidation and that is great, but you will want to make sure you really get a handle on your spending. This way you won’t be in the same situation again.

Debt is serious and if you are in a financial situation you are not happy with, take action now to make it better! Reach out to us if there is anything we can do to help you with auto financing.