Does Consolidating Credit Hurt Your Credit Score?

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jayben

Joined: 14 Oct 2009
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Posts: 9

261 Magic Points

Subject: Does Consolidating Credit Hurt Your Credit Score?

Mon Oct 19, 2009 8:48 pm

i have quite a bit of debt from an unsecured personal loanand student loans i took out and was wondering that if i consolidated them if that would hurt my credit score?

Justin

Justin

Joined: 17 Jul 2006
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Posts: 1093

25288 Magic Points

Tue Oct 20, 2009 6:34 am

Hi Jayben,

Debt consolidation is good idea, if you wish to lower to interest rate and get the extra fees and charges waived off. However, I don't think you can consolidate the loans if your student loan is federally granted. If it is a private loan, you can do it. Yes, debt consolidation hurts your credit score, since it indicates that you are unable to pay off your bill normally. This gets reported on your credit report and the potential creditors or lenders start viewing such people as 'risky' borrowers. As far as the score is concerned, it will take a hit, but exactly by how many points, it is impossible to say.
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Justin

SIA

Joined: 18 Oct 2009
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Posts: 59

1278 Magic Points

Fri Oct 23, 2009 5:34 pm

If you file for Chapter 13 bankruptcy, it will ruin your credit. The notation will stay on your credit report for 7 years and on your public records for 20

jayben

Joined: 14 Oct 2009
jayben's page
Posts: 9

261 Magic Points

Subject: thanks

Fri Oct 23, 2009 8:13 pm

justin and SIA...thanks for your comments. they've really helped. i guess i'll have to continue to get some advice to see what the best route will be for me.

but thanks again

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