Glossary
Debt consolidation
Rolling several debts into one loan with a single repayment. It can simplify your finances, but the total cost depends on the pricing and term of the new loan.
By Leverage Finance · Updated 17 July 2026
Consolidation means one new loan pays off several old ones (a car loan, a credit card, maybe a personal loan), leaving you with a single repayment to a single lender. For people juggling multiple due dates, the simplification alone can be worth a lot.
The caution is the term. Stretching short-term debts over a long term can lower the weekly number while raising the total you repay. A consolidation is genuinely better when the new loan's total cost of credit beats the combined cost of the debts it replaces, not just when the weekly payment looks smaller.
Some refinance applications include a consolidation element. The lender assesses it the same way they assess any lending: against your income, outgoings and credit file.
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