Debt Consolidation

Debt consolidation is the taking out of a new loan to repay several outstanding loans. The objective is to combine several high interest debts into one, lower interest loan payment.

Sometimes debt consolidation can refer to the consolidation of several debts into one, monthly payment through a debt relief program including a debt management plan, debt settlement program or consumer proposal. While each of these programs can consolidate debts, they are not considered a new debt consolidation loan but rather a debt repayment plan.