For those with debt trouble, considering consolidating their debts is often seen as a last resort. I am not sure if there is a certain amount of taboo attached to debt consolidation or that society in general consider this as the final nail in the coffin when it comes to their finances. Whatever it is, it is purely a misconception. Debt consolidation is not going to hurt your credit rating, it’s not a loan which raises a red flag or a black mark and it’s not an option ONLY consider by those who have had trouble managing their finances.
The reality is that debt consolidation is a way to a means. People with millions in the bank often consolidate their outgoings to save money and make things more manageable. There is nothing wrong with wanting to pay less money and their is certainly nothing wrong with wanting to make just one or two payments per month as opposed to 10+. Debt consolidation is all about taking whatever funds you owe currently, with different lenders and merging them into one. You’ve probably consolidated your debts in the past and not even known about it if you’ve taken our a personal loan for someone and used the left over amounts from that to clear some funds off your credit card - this is debt consolidation, just in a slightly smaller form than taking out a loan to cover ALL of your debts.
It is often said that by consolidating you ruin your credit rating. This simply isn’t true. Consolidation is just a loan, nothing more. It does the same for your credit rating as the personal loan you took out for your car or home improvements. The only thing that will hurt your credit rating is when you cannot manage your 10+ payments and start missing them due to poor management or lack of funds.