Debt Consolidation FAQs

What is Debt Consolidation?
Debt consolidation is when you combine all of your unsecured monthly bills into one bill and one interest rate. Debt consolidation companies work with their clients creditors to lower their interest rate. They also lower your monthly payments, as well as the time it would take to get the debt paid.

Does Debt Consolidation affect my credit rating?
It is often looked at as a positive move by creditors because they know you are serious about paying off your debt. In some cases it can help a bad credit rating.

How does Debt Consolidation work?
You will be paying all of your debts to one debt consolidation company instead of all of your creditors individually. Then that company will pay your debt to your creditors. Your one monthly payment should be lower than paying each creditor.

How are monthly payments lowered?
Debt Consolidation companies help your creditors agree to the lower monthly payments because you are attempting to pay your debts. You r creditors would otherwise lose money if you were to default on the loan or claim bankruptcy. It is better for them to lower your payments and interest and have the debts paid, than to lose money.