does debt consolidation loan effect credit score?

Submitted by carrieonup on Wed, 05/07/2008 - 20:04
Forums
Credit repair

I have 5 different loans out. well 2 bank loans, 2 credit cards and 1 to a family member. I am thinking about doing a debt consolidation loan just so I am not constantly worrying about paying them all every month. I would much rather pay 1 single bill. I'm not having trouble paying them yet and my interest rates are not to bad yet. my biggest credit card is at 0% interest until october then it goes up to 24% or something crazy like that. what I really am asking is --- will a debt consolidation loan hurt my good credit?

sdchargers_63

i don't think it would hurt it ( but, I don't know for sure). Usually if you get a Debt Consolidation loan, you combine all of your debts together and make ONE payment to a company. This would mean you paid everything off, through your loan. Now..if it's one of those things where the company 'slashes' the % on CC's ( like Consolidating your debts..NOT a 'loan thing') I would think it would be on your credit as a 'negative'. I DO know Debt Settlement will bring your score down.

Thu, 05/08/2008 - 00:48 Permalink
Laura

I dont think that it would adversely affect your credit score. Debt consolidation loan will only help you to consolidate your multiple debts into a single account.

Thu, 05/08/2008 - 06:30 Permalink
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Mon, 06/02/2008 - 09:37 Permalink
cinnamngrl

debt consolidation can be a nonprofit program where the interest and sometimes principle is reduced. this is marked on the relevant accounts on your report.

But if you get a separate loan that pays off all the debt than that shouldn't hurt your credit.

Mon, 01/17/2011 - 15:40 Permalink
crorkz matz (not verified)

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Tue, 08/05/2014 - 01:41 Permalink