Do Debt Consolidation Loans Hurt or Help Your Credit? Debt consolidation is one of the options people consider to address their outstanding debtsbining all your credit card and other debts into a single, new loan can help you get on the path to becoming debt free. One loan means a single debt payment to contend with every month, not a half dozen or more due at different times. Making one payment each month helps to streamline your debt repayment process and makes it less likely that you’ll forget a bill. A good debt consolidation loan will also be issued at a lower interest rate than …