Credit agencies look at your credit history as a whole and will see that the other accounts have been paid off in full.
Between paying off balances and making your new payments on time each month, you should start to see your credit score improving.
Consolidating loans affect credit score
If you're tempted to spend by leaving the accounts open, you can cut up the credit card or store it in a place that's hard to access—such as a safety deposit box at your local bank.
It's important to note that you can adversely affect your credit rating if you turn to a debt management agency to negotiate a settlement with your creditors for less than you owe.
This goes on your record as a failure to repay what you've promised.
People with good credit can normally go the DIY route when it comes to consolidating their debt.
You can transfer your balances to a new account—typically through a lower-interest credit card with a high credit limit.
Keep in mind, though, that there are normally transfer fees involved in moving balances from one form of debt to another.
Debt consolidation loans were created for the primary purpose of consolidating your debt.
There are two types—an unsecured debt consolidation loan, or personal loan, and a debt consolidation loan that is secured by the equity in your home, or a home equity loan.
The advantage of a home equity loan is that since the loan is backed by your house, the interest rate is lower.
However, either option will typically lower your interest rates and monthly payments. In the short term, applying for a debt consolidation loan or a new credit card will not significantly affect your credit score, though your credit will take a small hit from the new inquiry.
In the long term, debt consolidation will have a positive impact on your credit score, assuming you pay all of your monthly payments on time.