If you feel you'd be tempted to fall into this type of destructive borrowing then a debt consolidation loan really isn't for you...Before consolidating, you should note that some lenders may charge exit fees or early redemption charges if you repay ahead of schedule.
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The logic behind debt consolidation loans may seem sound and this type of borrowing can make great practical sense, but you need to beware of the pitfalls that could make it go very wrong. Small loans, payday loans, overdrafts, store and credit card deficits can all charge extraordinarily high rates of interest, while the very best rates are usually only available on bigger loans.
You can “consolidate” just one loan, or several loans.
You can consolidate loans even if you’re already in default.
While many Americans struggle to pay their credit card bills, a lot of them turn to businesses offering debt relief services.