There are plenty of reasons but the biggest is lowering your interest rate and taking control – you decide your monthly payment and improve your credit in the process.Debt consolidation is the process of merging outstanding debts such as multiple credit card balances or personal loans into one single loan.You must ask your financial institution for a loan equal to the amount of your total outstanding debts that are currently due.
A debt consolidation loan is a personal loan that allows you to consolidate your credit card debt, line of credit, car loan, and similar debt, into a single loan.
Several forms of debt consolidation are available in Canada.
The most common involves getting a debt consolidation loan from your bank, credit union, or other financial institution.
Credit card debt, utility bills, car loans and other personal loans can be consolidated, but mortgages cannot.
To qualify for one of these loans you usually need to have fairly good credit and sufficient income to be able to pay the loan.