Consolidating debt into one payment

However, there are specific instruments called debt consolidation loans, offered by creditors as part of a plan to borrowers who have difficulty managing the number or size of their outstanding debts.

For example, say an individual with three credit cards and a total of ,000 owing at a 22.99% annual rate compounded monthly needs to pay 47.37 a month for 24 months to bring the balances to zero.Debt consolidation loan interest payments are most often tax deductible when home equity is involved.A consolidation loan may also be kind to your credit score down the road.Even if the monthly payment stays the same, you can still come out ahead by streamlining your loans.Say that you currently have three credit cards that charge a 28% APR; they are maxed out at ,000 each and you're spending 0 a month on each card's minimum payment.

Consolidating debt into one payment