Debt consolidation - does it hurt your credit?

Both affect your credit, just in different ways. credit counseling doesn`t hurt your credit score but it does affect your ability to apply for more credit. Reason being is that while in the program it will show on your credit report you are in a dmp and until you complete it most lenders will not lend you money. However once you complete the program that drops off your report as if you were never in the program.Debt settlement does not show up on your report that you are in a program. However debt settlement does hurt your score because the accounts have to be delinquent before the creditors will negotiate a settlement.Debt settlement is for people in a hardship who's bills are either already delinquent or about to be. Both options are good depending on your situation. Hope this helps. :D

Thanks for the clairfication mobile, I have also wondered that.

You can also consolidate your debt without going into any programs depending on your financial status. One way to do this is to take a 2nd on your home and consolidate all your debt into one bill that would be paid as the second. Depending on your situation this may or may not be wise. First, it makes all your unsecured debt secured and attached to your house which isn't really a great situation but it is usually a cheaper bill. Second, you have to own a home and have some equity to even consider this option. Another option is a signature loan from a bank that may or may not be secured by some kind of property. You need to have ok credit to get both of these though.