Is debt consolidation smart?

[dreamy]

Is debt consolidation smart? Do you think this is something you have to do when you have accommodated a lot of debt or is something that should be avoided at any cost?

[sunshine]

I personally will try to avoid debt consolidation because this will prolong the agony. It depends on how much debt you have because it may be more than your monthly earnings and then you will need debt consolidation at any cost. Try to pay off the debt as fast as you can because the faster you pay the less the interest on your debt.

[Canadian]

The idea of debt consolidation is exactly that, to help you get rid of debt faster. By consolidating various loans with high interest rates to a single loan with lower interest, you'll be paying less in interest fees, which ultimately will make the repayment of your debt easier.

[lanaa]

Originally Posted by dreamy

Is debt consolidation smart? Do you think this is something you have to do when you have accommodated a lot of debt or is something that should be avoided at any cost?

It may not be the smartest thing to do but if you have no other choice, do it. The thing that was not smart is that you accumulated so much debt that you can't pay it any longer and you have to consolidate and pay higher interest and pay it for longer period...

[Canadian]

It will be a smart thing to do if it's going to save you on interest fees and will help you get rid of debt faster.

[bullish]

If you are able to find a single loan that can consolidate more expensive debts you have, go for it. I don't think you'll have trouble getting a consolidation loan, even with all the panic and "chicken little" attitude ruling the markets at the moment.

[Jason]

Do you know if the big Canadian banks offer consolidation loans, or is it just the small lenders and credit unions?

[trent]

Originally Posted by Jason

Do you know if the big Canadian banks offer consolidation loans, or is it just the small lenders and credit unions?

Yes the Canadian banks offer debt consolidation loans. For example this online form for personal loan from TD Bank, asks if the purpose of the loan will be a debt consolidation:

https://secure.tdbank.com/forms/bank/consumerloan.cfm

[Canadian]

I guess in the near future the majority of the new loans will be debt consolidation loans, because of the huge debt loads Canadians have and because the interest rates are trending lower for now.