YES 
In an ideal world, before applying for new credit
Eliminate as much outstanding debt as possible (especially when applying for a mortgage)
Hesitant lending to those with a lot of debt – Many banks, building societies, credit cards, and companies can be hesitant about lending more if you already have a lot of existing debt.
Debt above 40% of annual income is bad is a red flag (too many lenders).
This would not apply to a consolidation loan, where you’re specifically taking out a personal loan to pay off more expensive debts, such as payday or shopping accounts.