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You would think that the answer to that question is “no.” But not so fast. There are times when Life comes at you like you are  in an elevator with two particular celebrities and despite how well you were progressing with your finances, you find yourself unable to keep your head above water….and you are drowning.

There are a few times that a personal loan may serve you better in the long run than placing debt on your high-interest credit cards, assuming that you have little or no financial reserve to offset and/or completely stop the financial hemorrhaging. You can do a slow nod if any of these scenarios resonate with you and your current financial situation:

• You (naively) accepted multiple credit card offers to receive new rewards and benefits, and then over-leveraged those credit cards.
• Life provides you with an unexpected medical emergency, resulting in a bill for several thousand dollars, even with insurance coverage.
• Because you had no emergency fund and lost your job, you started living off credit cards for your day-to-day expenses and then start letting some payments slide. All of a sudden you wake up one day with more debt than you know what to do with.

Side note: There is no shame in facing the truth about what’s going on with your finances. These are all scenarios that can happen to any of us. ANY of us. If you checked “yes”, “double yes” and “triple yes” to any of these, before we move forward, please know this: What’s done is done. Forgive yourself. It’s now time for you to move forward with practical and actionable steps that can help improve your life, get your finances back on track, and ensure that you learn from your mistakes once and for all.

Here are some super important things to think about when deciding on a personal loan.

Understand What a Personal Loan Is: There are some stats that show that only 3% of Americans now what a personal loan is. With financial literacy so lacking in this country, I’m not really shocked by that number. Here is a nifty video by Discover that will give you a rundown of what a personal loan is. https://www.youtube.com/watch?v=u6Zm9oelJ9A

Pay super close attention to the following:

• How personal loans are different from credit cards
• How quickly you will receive your loan money

Avoid Loans That Require An Origination Fee: An origination fee is the cost you pay to receive money. This is in addition to the interest rate attached to your loan. The concept of origination fees is important for you to pay attention to, since not all personal loans are built the same. You will have to pay more to borrow money with loans with origination fees than loans without them, assuming the interest rates are the same.

Ensure that You Use the Personal Loan for Debt Consolidation (And Not Any Funny Business): The only way that I will allow you to leave this site thinking that it’s okay to secure a personal loan is if it is to consolidate your debt and pay it off faster. Let me say it again: Make sure youare NOT spending your personal loan money on anything other than what it was earmarked for, which is easing the pain of repaying several different debts with various interest rates with money you don’t have. If you have to resort to applying for a personal finance loan for debt consolidation, consider it a second chance to get right with your financial goddesses; so take advantage of this opportunity!!!

With a personal loan used for debt consolidation, you have an opportunity to give yourself a chance to slay all of your debt in one swoop and then repay that loan with a fixed interest rate within a fixed amount of time (which you will agree to with the terms of your loan).

Question: What do you have to say about using personal loans for debt consolidation?

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