Debt consolidation is a service offered by many creditors to make managing finances easier. Debt consolidation takes all of your current loans and credit cards and puts them into one loan with much smaller payments. The interest on this loan is much lower than your previous loans.

Debt consolidation has helped many people save lots of money. The reason creditors offer debt consolidation is that instead of you paying interest to other companies, you are paying it to them. Since all of the money is owed to them, they offer you lower interest rates on the loan. This is where you save money.