Consolidating Debt through Refinancing

Refinancing involves replacing an existing loan with a new loan that works better for you. Your new loan should have a lower interest rate and a term that meets your needs.

Unlike other types of debt consolidation, refinancing involves trading one loan for a different, better loan. Consolidating with a    or credit card balance transfer often means rolling multiple loans into a different, better loan.

Many kinds of loans, including mortgages, car loans and student loans, can be refinanced—possibly saving you thousands of dollars. And people don’t just refinance to get a better interest rate. Your primary reason to refinance might be to get a longer term that lowers your monthly payment or a shorter term that helps you pay off your loan sooner.

To determine which consolidation method best fits your life, consider talking to an expert such as a credit counselor. UW Credit Union offers free credit consultations and appointments with other knowledgeable professionals—financial specialists and student lending experts, for example—who can help you learn about refinancing. Consolidating Debt with a Personal Loan