You can’t borrow your way out of debt in the same way you can’t get out of a hole by digging out the bottom.Getting out of debt isn’t quick or easy, but it’s the first step to achieving lasting financial health. It simply means you’re taking out one loan to pay off a bunch of loans—or consolidating the debt to one payment.One of the most common reasons individuals take out a personal loan is for debt consolidation.
An error on any of your credit reports could prevent you from qualifying for the debt consolidation help you need, so .
Here’s how credit card consolidation works: You first decide if you want to take out a new loan, open a new credit card or enroll in a debt management plan (more on that later).
Whichever option you choose, you will use it to pay off your multiple balances.
But he concedes that it sometimes makes a lot of sense, especially if you’re swamped with high-interest payments and can swing a better rate with a loan.
Borrowing money is also personal, and the rates and terms available to you will depend a lot on your financial history.