Does consolidation improve your credit?
Date: Mon, 03/09/2009 - 07:49
I've always wondered, if you have $20,000 in debt over a number of differenct accounts and you consolidate into one account for $20,000, does that improve your score and rating? My husband wants to do that but with our debt to income ratio already high with late pays I don't believe we'd qualify for anything or if it would even help us.
Hi deepindebt, Do you mean a debt consolidation loan? It's pr
Hi deepindebt,
Do you mean a debt consolidation loan? It's probably the best way to get rid of all the debt. Since your creditors will go down to mainly 1, it should improve your score a little. Plus, your monthly payments will probably be a lot better. Shop around and see what you can come up with.
chrys
Yes, if you consolidate your existing debts into a single debt,
Yes, if you consolidate your existing debts into a single debt, it will improve your credit score, only if you make timely payments on the consolidated debt. However, if you default on your payments on the consolidated debts, it will get reflected in your credit report and may reduce your score.
Thanks for the responses, yes I meant a debt consolidation loan.
Thanks for the responses, yes I meant a debt consolidation loan. My thinking was that since it's the same amount owed, it would not improve your score.
