<human>:  What are the pros and cons of using a debt consolidation loan?
<bot>: 
Pros of Using Debt Consolidation Loan
 • Allows you to pay off expensive debt faster by combining all your debts into a single loan with a lower interest rate.
 • Helps you to simplify and streamline debt payment by consolidating multiple payments into one.
 • Gives you leverage to negotiate a better interest rate and repayment terms with your creditors.
 • Can reduce the amount you have to pay each month and lower your overall debt.
 • Allows you to avoid bankruptcy and rebuild your credit by having all payments accounted for in one place. 2

Cons of Using Debt Consolidation Loan
 • May have costly fees or other financing charges associated with it.
 • May require collateral like a home or car, which you could possibly lose if you are unable to keep up with payments.
 • May require a good credit score to qualify for a low-interest rate.
 • May not cover all of your debt, leaving you with the remaining portion to repay.
 • There is always the potential for higher interest, so it pays to shop around for the best deal.