A debt consolidation loan is a single loan (generally from a financial institution) that allows you to repay your debts to several or all of your creditors at once.You are then left with only one outstanding loan — to the financial institution.One of the first things you’ll want to do is check your credit reports for accuracy.

Your financial institution will be able to tell you which of your debts you will be able to pay off with the loan that they grant you.

You must ask your financial institution for a loan equal to the amount of your total outstanding debts that are currently due.

In most cases, the financial institution will settle all the debts for you and, in return, the only monthly payment you will have to make will be to them.

In addition to streamlining your debts into a single payment, a debt consolidation loan may also offer you an interest rate that is lower than that charged by your creditors saving you money in interest charges.

This option can be especially attractive if you have outstanding debts at a relatively high rate of interest (for example, those charged on some retail store cards or credit cards).