Debt consolidation is a process which saves customer from the problems of handling large debts of multiple creditors. It brings overbearing monthly credits within affordable limits.

In other words, Debt consolidation is simply taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

Debt consolidation is actually a fairly simple process. A consumer overwhelmed by bills from various creditors can take their debts and merge them into a single loan at a lower interest rate than they were paying.

With an increase in the debt problems across the country, there is a rapid growth of debt consolidation firms nationwide. Consolidation can affect the ability of the debtor to discharge debts in bankruptcy, so the decision to consolidate must be weighed carefully.

The customer can take advantage of adopting debt consolidation in a simple way. For example : Instead of paying 20 different creditors who are charging different rates at different times of the month, customer take out one big loan and pay off all those accounts. Then he make a single payment on that loan once a month.