Debt Consolidation Loan
What is a Debt Consolidation Loan?
Debt Consolidation Loan means that ALL your credit cards and loans are now consolidated in one Bank. The Bank extinguishes all your loan debts in all banks, and now you are a customer of only one Bank. This is a regular debt consolidation scheme.
It is very convinient to have only one Bank instead of 5-10, but also make benefit in a lower interest rate. Usually, when you consolidate loans, the Bank reduces the interest rate, quite often very significantly.
Moreover, given the debt load of the population, consolidating debt could save a lot of bad credit histories, and give banks an opportunity to avoid penalties for overdue payments on loans.