Consolidation loans come in many different guises. Some of the more common types of consolidation loans are debt consolidation, mortgage consolidation and bill consolidation.

Basically a consolidation loan is just used to bring together a number of different debts/bills and pay them off with another loan which has a lower interest rate or has better terms (such as the ability to pay fortnightly or no ongoing fee).

So if you had a lot of outstanding bills waiting you could use a bill consolidation loan to pay them all off at once and then pay the consolidation loan off over time.

If you had multiple mortgages on a house or on multiple pieces of real estate you may be able to bring them all together with the one lender and so not have to worry about paying off multiple mortages with multiple lenders.

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