A
loan issued by a
bank or other
financial institution used to pay off existing
debts. The idea is to save money in the long run by reducing
interest paid. Also useful for closing credit card accounts.
Warning: When websearching for information on debt consolidation, many of the hits will be companies trying to convince you that they are the best choice for a loan.
First, investigate your options with a nonprofit group such as American Consumer Credit Counseling, available at:
http://www.consumercredit.com