It is a financial service that helps an individual or business consolidate multiple debts into a single loan or payment plan, typically with a lower interest rate and more manageable terms.
Main Objective:
- Reduce the monthly financial burden.
- Facilitate payment management.
- Avoid default or over-indebtedness.
- Common forms of assistance:
- Consolidation loan.
- Credit counseling programs.
- Negotiation with creditors to obtain better terms.
Importance:
- Improves financial organization.
- Can help protect credit history.
- Offers a path to financial stability.