Loan consolidation - sustany/dvg GitHub Wiki

A loan consolidation combines a number of loans into a single new loan with a lower interest rate and a new payment plan. Loan consolidation has many benefits. A debtor doesn�t have to pay different creditors, but can make one single payment to one creditor each paying period (usually a month). The interest rate is usually lower, and the repayment period will be extended. However, there�s also risk making a loan consolidation. If the term is extended greatly, the interest amount may be greater even if the interest rate has been lowered.

Most lenders look at the debtor�s credit score, income, and credit history in deciding if a debtor�s is eligible for a loan consolidation.

After a loan consolidation, a debtor will generally have a higher credit score if he or she can make the payments on time.