Will consolidating my debt hurt my credit

Posted by / 24-Jun-2017 05:38

Having fewer payments to juggle and saving on interest can help you pay off debt.

Common approaches are using a balance transfer credit card or personal loan, but you can also borrow against your home equity, 401(k) or life insurance.

It heavily influences a whopping 30% of your credit score, and if you have several maxed-out cards, yours is probably sky-high.

But keep in mind that only the balances on revolving lines of credit are factored into your credit utilization ratio; by moving your credit card debt onto an installment loan (the personal loan), you’re shifting it in such a way that it will have a minimal impact on your credit. If you choose to consolidate with a 0% APR card via a balance transfer, the picture is a little more complicated.

We even share how we make money so you can rely on our expert advice and recommendations with clarity and confidence.But what about different forms of debt consolidation?Consolidating debt is usually one of your first lines of defense against the bad outcomes of severe financial distress, but can the solution also cause any delay to achieving your future goals?If you’re not sure how consolidating your credit card debt will affect your score, take a look at the details below – the Nerds will tell you everything you need to know!Rolling multiple credit card debts into a single consolidation loan has a lot of important benefits.

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