Debt consolidation is a strategy for managing debt that involves using a new loan, credit card or payment plan to pay off your existing debts. When you consolidate, you’ll roll multiple existing accounts into one new account. Ideally, this will make your finances more manageable.
Prosper explains that debt consolidation can potentially help if you want to reduce the number of your monthly debt payments, secure lower interest rates, reduce the total amount you pay each month, or eliminate creditor fees. Consolidating debt can also help you end a relationship with a bad creditor, assuming you pay off the remaining balance you owe them.
There are multiple products you can use to consolidate your debt,…
