Find out more about how debt consolidation loans work, then get free debt advice before you make a decision.If you’ve got lots of different debts and you’re struggling to keep up with repayments, you can merge them together into one loan to lower your monthly payments.Try adjusting your terms, loan types or rate until you find a consolidation plan that fits your needs – and most importantly your budget!If you checked the 'Use credit card minimum for payments' box, your monthly payment is calculated as 4% of your current outstanding balance.The more equity you have, the more money you may be able to get from a cash-out refinance.Many homeowners take cash out to pay off high-interest debt or make home improvements.

With this box checked, your monthly payment will decrease as your balance is paid down.However, refinancing to get cash out or consolidate your debt may result in a longer loan term or a higher rate, and that might mean paying more in interest overall in the long run.Consolidating all your debts into one loan might appear to make life easier but there might be better ways to pay off debts.Before you choose a debt consolidation loan think about anything that might happen in the future which could stop you keeping up with repayments.If you can’t stop spending on credit cards, for example because you’re using them to pay household bills, this is a sign of problem debt.