The problem with taking out a loan to pay off your credit cards is that you are treating the symptom. Debt is the symptom, not the problem. The problem is mismanagement, over spending, and lack of savings. We have found that the best way to attack this issue is in habit patterns. So we do not recommend bill consolidations, except in extreme circumstances.
Consolidation loans tend to have lower interest rates than credit cards.
Those rates can be even lower if you consolidate into a home equity loan or other secured product. If you do get a consolidation loan, don t allow yourself to think that those zero-balance credit cards are an invitation to spend. Cut up your cards, put them in a drawer or rely on your willpower, but don t give in to temptation or you ll get deeper in debt. Depending on your situation, you may be better off shopping for a single credit card that has a high annual fee and a low interest rate. By transferring your balances to a single card you ll have fewer bills to manage.