Debt Consolidation Loan - a pen on a stack of financial documentsA debt consolidation loan gathers your debt into a single amount so that you can repay multiple creditors through one monthly payment. The interest rate is often lower than what your existing creditors offer.

If you choose to participate in a debt consolidation loan your financial institution will pay your creditors and in exchange, the financial institution will offer you a new loan with a single monthly payment at a potentially lower interest rate.

Your eligibility depends on your overall credit rating and the total amount of your debt.

If you do not think you will be able to qualify for a debt consolidation loan, you may want to consider a Consumer Proposal since it has the same effect of grouping all your creditors into making one monthly payment.