If you have too much debt to handle, you might consider debt consolidation.
If you are finding it hard to keep up with your monthly payments and as a result, you are damaging your credit score, then you can consider debt consolidation.
One payment to one lender
Debt consolidation is when you apply for a debt consolidation loan with which a lender repays all your debt with the loan and you repay the lender.
Therefore you will now only need to make one payment to one lender. Even though the loan will be the sum of all your current debt, you will be saving some money since you will only be repaying interest on one loan rather than paying interest on each store account, credit card, and loan.
This will make it easier to make the payments which mean that you are far more unlikely to default on payments, which damages your credit score.
Benefits of debt consolidation
- You only make one single payment to one lender.
- It is possible to save on interest as high-interest accounts are consolidated into one payment.
- If you are indebted, it could help you maintain your credit score.
- Smaller payments are made over a longer period.