what is debt consolidation means ?

Consolidation of debt means combined your all outstanding debt in a single one.
The main advantage with the debt consolidation that you need to pay only a single payment in month.

How debt Consolidation Company work:

Debt consolidation company first analyze the maximum installment charge which you can able to pay.

They meet with your creditors and try to convince them for waive off your extra payment and try to reduce your interest rate with the creditors.

Debt consolidation company fix your monthly payment of bill which also include there fees.

Your creditors call diverted to debt Consolidation Company for any further clarification.

Debt Consolidation Company distributes your debt installment among your creditors.

Debt consolidation has advantage as well as disadvantage also:

Advantage:
Reduce monthly bill: Debt consolidation reduce your monthly bill.

Single payment: You need to pay only one installment to the debt consolidation company.

Waive up off your addition charges: Debt consolidation company waive up your extra charges on the bill by your creditor which helpful for you.

Save your money: Debt Consolidation Company which helps you to get lowest interest rate than before which help you to save money.


Disadvantage:

Increase your total debt: Debt Consolidation Company also charges there fees for there service which is also one kind of debt on you.

Increase total maturity period: Your monthly installment reduces but the total maturity period will increase which affect your retirement investment plan.

Interest is not reduce : Debt consolidation company will help you to get lower interest rate but they also increase the maturity of debt payment which means you need to pay interest for longer time ,that means you ultimately not benefited by the lower interest rate.