What is the process of combining multiple loan payments into one called?

The process of combining multiple loan payments into one is known as loan consolidation. This approach simplifies the management of debts by allowing you to merge several loans into a single loan, often resulting in a lower monthly payment and potentially a lower interest rate overall. This is particularly beneficial for individuals juggling multiple debts, as it streamlines their financial obligations and can make budgeting easier.

Loan modification refers to changes in the terms of an existing loan, often to make the payments more manageable, but it does not involve combining multiple loans. Debt refinancing involves taking out a new loan to pay off existing debt, typically to achieve a better interest rate or different loan terms, but it doesn’t specifically refer to consolidation. Debt settlement is a negotiation process where an agreement is reached to pay a portion of the debt owed and is not related to the consolidation of loans. Thus, among the options, loan consolidation stands out as the correct answer for the process described.