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Old 07-24-2008, 06:08 PM
Canadian Canadian is offline
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Join Date: Jun 2008
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Debt consolidation is combining several debts into one, in order to pay less interest charges. For example let's say that you have 2 credit cards with $5,000 outstanding balance on each. The first card charges you 16% per year, and the second one charges 18% per year. If you can find another credit card issuer that can offer you 12% interest per year, and you transfer both balances to the new lower-interest credit card, then you'll be paying much less in interest.
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