Most people have too much debt and this can cause them to miss credit card payments. It may be time for you to consider getting a Debt Consolidation Loan which can be very beneficial for you and your credit. Most people who are having a hard time making payments may need to see about getting a Loan so they can consolidate there debt into one monthly payment. It makes it much easier to keep up with if you do not have to make separate payments for each credit card you own. You also can benefit by getting a lower interest rate which will help you save money over the life of the loan. It is also a good way to pay the loan faster if you are paying a lower interest rate.
The worst thing about missing payments or defaulting on credit card debt is that your credit score will suffer greatly form it. One of the most important things to getting a traditional unsecured loan is to have a good credit score. It is very important for you to get the bad credit paid off and get your credit rating back on track.
When you are looking for a Debt Consolidation Loan you need to get help form a Professional because they have the experience you need to negotiate the debt you have into one loan. Make sure that you are comfortable with the company that you find to help you because the process will be much smoother and quicker for you.
Friday, May 2, 2008
Does Debt Consolidation Affect Credit Rating?
Are you considering a debt consolidation loan or a debt consolidation program? Have you ever wondered if debt consolidation affects your credit rating? Here is 3 reasons why debt consolidation affects credit ratings in a positive way.
Tip #1
If you have a lot of credit card debt, then it is affecting your credit rating in a negative way. One thing that credit card companies don't tell you is that if you carry a balance on your cards and it is over 25% of your credit limit, then you are actually penalized on your credit rating, even if you pay your payments on time. So if you consolidate debts that include credit cards with high balances, then you are doing yourself a favor and helping your credit.
Tip #2
You can consolidate not only credit cards, but if you have a car or a personal loan, then when you consolidate those and pay them off you will improve your credit rating. The credit companies love to see that you paid off a car or a personal loan. It helps to boost your credit score quite a bit.
Tip #3
If you have enough debt that you are considering consolidating it, then it is obvious that you need to. The key is that if you consolidate your debt and payoff credit cards, then you need to stop using the credit cards and get rid of them. If you consolidate your debts and then you run your credit cards back up to their limits you are doing nothing to help yourself. You will end up in a worse situation, then you were in to begin with.
So if you are considering consolidating your debts keep in mind that debt consolidation will affect your credit rating and it can be in a positive way if you are responsible and smart with your debt consolidation.
Tip #1
If you have a lot of credit card debt, then it is affecting your credit rating in a negative way. One thing that credit card companies don't tell you is that if you carry a balance on your cards and it is over 25% of your credit limit, then you are actually penalized on your credit rating, even if you pay your payments on time. So if you consolidate debts that include credit cards with high balances, then you are doing yourself a favor and helping your credit.
Tip #2
You can consolidate not only credit cards, but if you have a car or a personal loan, then when you consolidate those and pay them off you will improve your credit rating. The credit companies love to see that you paid off a car or a personal loan. It helps to boost your credit score quite a bit.
Tip #3
If you have enough debt that you are considering consolidating it, then it is obvious that you need to. The key is that if you consolidate your debt and payoff credit cards, then you need to stop using the credit cards and get rid of them. If you consolidate your debts and then you run your credit cards back up to their limits you are doing nothing to help yourself. You will end up in a worse situation, then you were in to begin with.
So if you are considering consolidating your debts keep in mind that debt consolidation will affect your credit rating and it can be in a positive way if you are responsible and smart with your debt consolidation.
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