Sometimes low interest debt consolidation loans can be used as a vehicle to consolidate debt, but you should take the time to decide if this is really the best thing for you. There’s a lot to consider when it comes to financing your consumer debt with a loan. And many financial experts recommend against it for various reasons.

Let’s start with the loan itself. It goes without saying that one of the requirements to obtain a loan is to have creditworthiness. In order for you to get a low interest rate, you will need to own a high credit score. The higher the credit score, the lower the interest rate. The other requirement will be to own a home that has available equity. Secured loans have lower interest rates than unsecured loans.

In case you find a lender that will give you a low interest loan to finance your debt, that is not the end of your worries. This loan will be secured with your house. So if for some reason you can’t make the payments, you are at risk of foreclosure. In this time of economic uncertainty, putting your home on the line with credit card debt doesn’t seem like a very smart move.

A big problem with loans is that money is transferred from your credit cards to a loan, leaving your credit cards with money available. This can be very tempting and can be a trap for people consolidating their debt with a loan. There are many people who have obtained a debt consolidation loan to pay off their credit cards only to be out of credit card debt again within a year.

If you are considering a debt consolidation loan, you may want to investigate non-profit credit counseling as a debt consolidation option. This allows you to consolidate your credit cards at a reduced interest rate without a loan. You do not need to own a home or have good credit to qualify. The risks are much lower with this option than with a home-secured loan.