Debt Consolidation -- Good Solution or Terrible Mistake?

Debt Consolidation -- Good Solution or Terrible Mistake?
Before proceeding with any debt-consolidation loan, question the terms of the loan as well as your own plan and discipline so you can make sure you have an arrangement that will not get you further into debt. fizkes/Shutterstock
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To the person drowning in debt, a debt-consolidation loan looks like a lifesaver. But reaching for it without knowing exactly what it’s made of could be a severe mistake.

The way it’s supposed to work: You pay off all your small high-interest consumer debts with the proceeds of a new low-interest loan whose payment is less than the total of the smaller payments.

Mary Hunt
Mary Hunt
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Mary invites you to visit her at EverydayCheapskate.com, where this column is archived complete with links and resources for all recommended products and services. Mary invites questions and comments at https://www.everydaycheapskate.com/contact/, “Ask Mary.” This column will answer questions of general interest, but letters cannot be answered individually. Mary Hunt is the founder of EverydayCheapskate.com, a frugal living blog, and the author of the book “Debt-Proof Living.” COPYRIGHT 2022 CREATORS.COM
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