Benefits

• Debt consolidation can prove to be a smart solution to handling your financial burden. Not only does it lower your monthly payments, but it also creates a new credit account on your credit report. As a result, all the accounts that you consolidated are identified as paid on the report.
  
  

Time Frame

• Your credit score can improve as you begin making your new monthly payments on time. However, it's important to realize that raising your score can take a considerable amount of time. This is because you have to establish a good payment history on the new account before you can begin to see positive changes, according to the financial portal site Financial Web.
  
  

Warning

• Debt consolidation can have its drawbacks. For one, if you fail to make the new monthly payments on time your credit score will reflect that. In addition, according to Financial Web, if you negotiated a lower balance with lenders during the consolidation process, this can have a negative impact on your credit.