A Debt Consolidation Loan is used to combine all your existing consumer debt or credit card debt into a single loan and one monthly payment. The advantage of this type of debt loan is that you can consolidate your high interest credit cards, auto loan and/or student loan debt, into one single lower monthly payment. It allows you pay off bills and stop creditors from calling. Depending on the amount of debt that you have you may or may not collateral. Most people will take out a debt consolidation loan against there home and that will allow them to get a very low interest rate.