what is debt consolidation loan

Debt consolidation loan is a type of loan that combines multiple debts into one payment, simplifying how many payments you have to make. It may offer lower interest rates than what you're currently paying, which could help you pay off your debts faster. Debt consolidation loans are offered by banks, credit unions, and installment loan lenders. Personal loans and balance transfer credit cards are the most common ways to consolidate debt. Personal loans are unsecured loans from a bank or credit union that provide a lump sum payment, while balance transfer credit cards allow you to transfer high- interest credit card balances to a card with a lower interest rate. Debt consolidation loans can be a smart move under the right circumstances, but it's important to weigh your options to see if it's a good idea for your situation. It's also important to beware of debt consolidation promotions that seem too good to be true, and to understand the terms and fees associated with the loan.