What is the process of combining several debts into one payment known as?

The process of combining several debts into one payment is known as debt consolidation. This method simplifies the management of multiple debts by merging them into a single loan or payment structure, which can streamline repayment and potentially lower overall interest rates. By consolidating debts, individuals may find it easier to manage their finances since they only need to keep track of one payment each month instead of multiple due dates and amounts.

Debt consolidation often leads to more favorable repayment terms, such as a longer repayment period or a lower interest rate, which can reduce monthly expenses and help individuals pay off their debts more efficiently. This strategy is particularly beneficial for those struggling to keep up with multiple payments and can be an important step toward achieving financial stability.