 TITLE: Should I Get a Balance Transfer Card or Debt Consolidation Loan? CONTENT: A debt consolidation loan is a loan that you take out with the purpose of paying down one or more of your other debts. In doing so, you can consolidate (or combine) multiple debts into one new account, decreasing how many monthly bills you have to manage.\nConsolidating debts can lead to savings if your new loan has a lower interest rate than your previous debts. And, your single monthly payment may be lower than the previous combined monthly payments—freeing up extra money each month.\nDebt consolidation loans are typically unsecured personal loans. You can also consolidate debts using different types of loans, including home equity loans and cash-out mortgage refinancing. Be warned, however, that defaulting on a secured loan can cause you to lose the collateral that backs it, such as your home. END