Debt Consolidation is a process through which your unsecured debts are consolidated into one, single loan where the payment is offered at a reduced interest rate.  While debt consolidation does not reduce the amount of total debt you actually owe, it can accelerate the payoff process as the interest rate is reduced.  Additionally, the debt consolidation loan payment is often less than the "numerous" monthly minimum payments you have been struggling to make to your different unsecured creditors.  A debt consolidation loan will typically be secured with some form of collateral, such as a home or a vehicle.

Debt consolidation loans are a common debt strategy that Christians explore when trying to resolve unsecured debt problems.  While there are tax advantages to eliminating unsecured debt with this method, there are risks that should be taken into careful consideration.  Since these loans are often secured with your home (through a second mortgage or home equity line of credit), if you encounter severe financial hardship for any reason and default on these payments, you could lose your home. The conversion of unsecured debt into “secured debt” through this debt consolidation loan process has risks that merit serious deliberation.

The advantages perceived by Christians exploring this debt reduction alternative are: (1) a debt consolidation loan does provide a single monthly payment, (2) interest on a second mortgage or home equity loan is almost always less than the current rates being charged by unsecured creditors and (3) interest expense is tax deductible in most cases.

ChristianDebtConsolidation.net encourages you to investigate all advantages and disadvantages relative to an unsecured debt consolidation loan as your debt strategy before making your final decision. If you feel a debt consolidation loan is an option you want to explore, we still encourage you to also request our complimentary consultation and review the merits of a debt settlement program as your Christian debt strategy.