Contact several financial institutions before you choose a consolidation loan since the interest rates offered by competing financial institutions may vary.
You must ask your financial institution for a loan equal to the amount of your total outstanding debts that are currently due.
In most cases, the financial institution will settle all the debts for you and, in return, the only monthly payment you will have to make will be to them.
Some people believe that debt consolidation lowers your credit rating because you are using another party to help coordinate paying your bills.
You will get assistance in the process but the end result of a successfully combining your debts is improved scores.
Within the first few months of joining a consolidation program, your scores may decrease somewhat because the debt management company will have to make arrangements with all of your creditors and that could take a few months, depending on the company.