Consolidating credit card debt affect credit score
Peer-to-peer lenders like Lending and Prosper.com, for example, routinely make these kinds of loans to borrowers with good credit.Your bank or credit union may also be willing to help you consolidate, and there are some online lenders that offer consolidation loans.Otherwise, you may fall into traps such as getting stuck with a balance at a high interest rate after the introductory period ends." data-reactid="20"Transferring a high-rate credit card balance to a card at a lower rate can be another way to consolidate.Carrie Rocha, author of Pocket Your Dollars: 5 Attitude Changes That Will Help You Pay Down Debt, and her husband paid off some ,000 in debt, and taking advantage of low-rate balance transfers was one of the strategies they used to dig out.wiki How's Content Management Team carefully monitors the work from our editorial staff to ensure that each article meets our high How marks an article as reader-approved once it receives enough positive feedback.This article has over 84,560 views and 81% of readers who voted found it helpful, earning it our reader-approved status. It’s possible to pay off debt without harming your credit. Content Header .feed_item_answer_user.js-wf-loaded . When you are trying to get out of debt, consolidating credit cards or other loans can save you time and money.
On the other hand, FICO ignores any notation that you are paying your debt through a counseling program when calculating your scores.In fact, the faster you pay off your debts the more your credit score will improve.Ideally, you should come up with a budget and pay off your debts as soon as possible.If you use a substantial portion of the available credit on the card to consolidate balances from other cards with lower balance-to-available-credit ratios, your credit scores may drop.You may also lose points if you open a new card and use a substantial portion of the credit line to consolidate.