Does a Debt Consolidation Program Affect Scoring and Credit History? [debtconsolidationsreviews]

Does a Debt Consolidation Program Affect Scoring and Credit History? [debtconsolidationsreviews]

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A debt consolidation and assistance program can help to square away your credit issues. But this comes about from your own hard work. When you consolidate your debts, you're merely turning over all of your debts and then turning them into one debt using this organization. The company arrives at agreements with your creditors. Once resolutions have been met, the organization pays back all of your creditors. You're now in debt to the company and have to pay a previously stipulated rate of interest and monthly fee.

Once this happens, in a way, you will have a spic-and-span start. You'll have the peace you need to carry on in life without the burden of debtors breathing down your back.

You will have peace and quiet, with no creditors annoying you or hassling you. But, debt assistance can create a damaging bull's eye on your credit for a few years.

Because of this, you must take the time to build up a completely new credit story. You must pay a bit of money for secured charge cards, or catalog buying accounts.

You can also get a few humble inexpensive loans for below $ 200 and pay off the company within days.

Now when it comes to scoring, right after you've gone through your consolidation, you won't score so well. In fact the consolidation will effect your credit score for some time after you have gone through the procedure.

This will give you a much needed break to rebuild your credit, and get your life back together. Going into the consolidation you probably already had pretty poor credit, and are trying to make it better. If this is the case, then this time could be exactly what you need.

Start getting involved with credit building programs that will report to the credit bureaus.

These programs include options where you can purchase things from a catalog or online store, and pay it off in monthly payments. More Does a Debt Consolidation Program Affect Scoring and Credit History? Articles

Question by sadlymistaken: If you use one of those debt consolidation programs, does it affect your credit score? You know where you call and they stick all your debt all together and then lower your interest rate so you can pay it off faster. Does that stay on your credit report, like filing bankruptcy? Best answer for If you use one of those debt consolidation programs, does it affect your credit score?:

Answer by Jont
It does show up on your credit report, and it will affect it negatively, but not as bad as not doing anything or bankruptcy.

Answer by annazzz1966
If you stick all your debts together and get a lower interest rate, its not going to allow you to pay your debt off faster. You're going to pay interest for as long as you pay the payments.

Answer by Jonathan
Do not do consumer credit counseling if you are planning on buying a home anytime soon. Most lenders and banks view it as a bankruptcy because to them it shows you that you cannot handle your debt.

Answer by the crusader
I don't think so, but I would suggest that you don't use one of them anyway. Those things are a big scam. They will consolidate your payments into one bill, but then they add their own interest and it's ridiculous. If you have credit card debt, deal with your creditors on your own first. They just want to get paid and will be willing to negotiate with you. Good luck.

Answer by flowerpotz2003
ive actually done this about 1 year ago, it has saved me alot of worry and money. also it works toward your credit to make it better as long as you keep up with the payments. ive got another couple of years to pay it off but it is helping me with those nasty phone calls and mail. i totally agree to checking it out but make sure you read ALL the fine print. good luck they will work with you, i went to citifinancial

Answer by tt
I agree totally with you. Borderline entrapment if you ask me. For what it is worth this might help. There is a free download software look at my profile for the url finance. The software gives you a perspective of where you are with your debts and gives a strategy on how to clear them. Its shareware software that I used with some success. It just might help you.

Answer by Freak Boy
Many of these services require you to cancel your card accounts. This will lower your score, because your score is calculated with AVAILABLE CREDIT. If you cancel your cards and you have a low credit score, you will not be able to get credit at all. Best bet is to find a way to get yourself current and get your ratio of balance to limit to 49% or below.

Answer by ebizoutlook
I have included two articles in my resource box that might be helpful for your situation. Good luck!

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