Credit utilization is important, as it constitutes about a third of your overall credit score
Once you combine all your credit card balances into the new debt consolidation loan, all these cards will be at zero balance. This is a key step on your way to becoming debt free. Credit cards with low or no balances on them are also good for your credit rating, since they improve your overall credit utilization.
Credit utilization, meaning the amount of available credit a person has borrowed, is one of the five factors used to compute your overall credit score.