A common misconception about debt consolidation agencies is that they will close your credit card lines, if you are approved for a loan.
This is not the case.
They may advise you, but they cannot force you to close down your credit card accounts, or stop you from applying for new ones.
Credit cards are a fact of life.
You will almost certainly need some line of credit, even if you have applied for a debt consolidation loan.
To get a hotel room, rent a car, reserve a service, or even handle online transactions they are needed.
The dilemma that most agencies have is usually credit cards that brought you to have to use their service to begin with.
Consolidation loans will pay off your credit cards, but the credit lines remain open.
If you have multiple credit card debts, that are paid through consolidation.
It is recommended that you close all but one.
It should be the lowest interest rate of your cards.
This may mean that you have less credit available to you, but that is ok.
You do not really want to have the temptation to use the card unless you absolutely need to.
Another recommendation you may receive is to close all credit lines, save some money, and then get a secured credit card.
These cards are pre-paid.
You cannot overdraw on them.
These are ideal for people that truly have discipline problems with credit.
The only time that a debt consolidation agency will close credit lines, is if they have gone into negotiation and settlement first.
Normally the card companies will close your accounts because they have settled on a lower loan balance, and reduced interest rate.
If this happens, you may still try to obtain a new credit line.
You are the best judge of your use of credit.
You have to be honest with yourself.
If you have discipline problems with cards, then you need to get them paid off quickly.
The debt consolidation will do that for you.
But then you must develop proper habits of using credit.
You may want to speak to a financial counselor if you continue to spend and find yourself in trouble again.