only extend the pay-off period and do not carry lower rates. Since interest on consolidation loans is often higher than personal loans, mortgages and home equity loans, you actually owe more in the long run.
If you consolidate your loans, Freeman advises to use caution. “Many [debt consolidation agencies] are flooded with scams, and lenders who charge exorbitant fees and offer no real solutions to your debt,” she says. Some consolidators add fees directly to your monthly debt payments, without notifying borrowers of the charges.
To help deal with debt, Freeman recommends that consumers establish a budget, develop a debt management plan, and consider credit counseling. Most importantly, use common sense by not spending money you do not have.