Is debt consolidation a good way to save money?

Debt consolidation is a process that allows individuals to combine all their outstanding debts into a single loan, and it is not a good way to save money. By choosing debt consolidation, individuals actually have to pay back a larger amount of money than they initially borrowed.

Debt consolidation companies usually look to secure loans against an asset, such as a property. Unsecured loans may be available, but the interest payable on them is often much higher. Alternatives to debt consolidation include taking another loan that can actually reduce the debt and talking to creditors about freezing interest for the existing balance.