The consolidation of debt can simply be of a certain number of loans without guarantee in another loan without guarantee, but more often it implies a loan fixed against capital which is used as guarantee, most generally a house. In this case, a mortgage is fixed against the house. The collateralization of the loan allows an interest rate of interest lower than without him, because by collateralizing, the owner of capital is to allow the obligatory sale (preclusion) capital of agreement on the wages behind the loan. The risk with the lender is thus reduced the interest rate of interest offered is lower.

Sometimes, the companies of consolidation of debt can discount the amount of the loan. When the debtor is in danger of the bankruptcy, the unifier of debt will buy the loan with a discount. A careful debtor can compare the prices before buying the unifiers who will pass along a part of the saving. The consolidation can affect the capacity of the debtor to discharge from the debts in the bankruptcy, thus the decision to be consolidated must be weighed carefully.

The consolidation of debt is often recommended in the theory when somebody pays the debt of chart of credit rating. The charts of credit rating can carry an interest rate of interest much larger than even a loan without guarantee of a bank. The debtors with the property such as a house or a car can obtain a lower rate by a loan fixed by using their property as a guarantee. Then all the interest and all the cash flow of financing paid towards the debt is lower making it possible the debt to be paid with far earlier, incurring less interest.

Because of the theoretical advantage that the consolidation of debt offers a consumer who has high balances of debt of interest, the companies can benefit from this advantage of the refinancing to charge the very high fees in loan of consolidation of