The cliche about rearranging the deck chairs on the Titanic came to mind when I read your question.
Debt consolidation won't address the real problems that may sink your credit rating!
SEARCH RATES: If you're considering a personal loan for debt consolidation, first check out the rates at
The principal reason is you will have a new inquiry and huge installment loan appear on your credit report, even though you also will have much lower debt-to-credit ratios on your credit cards.
The potential underwriting risk that you present to a new lender is measured in conjunction with your credit score and will now have to incorporate that you have the chance to begin adding to your credit card balances again.
And the fact that many people do just that is why the action will temporarily cut your rating.
For the record, and for those who don't know the difference, a credit rating and a credit score are 2 different things.
A credit score is derived from items reported in your credit file.
It uses a complex mathematical algorithm to come up with a score that predicts whether you are more or less likely to default on your next loan.
A credit rating is assigned by a person who looks at issues beyond your credit report before deciding how creditworthy you are.
These issues include income, job stability, your ability to use dormant credit lines and more.
I want you to concentrate on your overall financial health rather than on a score or rating.