Debt consolidation?
Question:
Will it be hard to get credit cards again?
I have never been late on payments, I just feel swamped with credit card payments.
I am in Ontario Canada if it makes a difference.
Any help would be appreciated.
Thanks everyone!!
Answer:
You should really consider meeting with a credit counsellor. Find an agency near you that you can meet with a counsellor face to face.
They can tell you how different types of consolidation might affect your credit. It really does depend on the type of consolidation as well as your own personal situation (credit score and debt accounts).
No consolidation does not hurt your credit. The only times that you will find a mark on your record is if you are delinquent with your payments or if you use a financial counseling service who negotiate with your creditors to get your debt reduced.
It is one step up from going bankrupt on your credit history. Don't do it. I know 2 people that thought it was the answer. Both were sorry. One had never been late on a payment. Used a service like you are speaking of in your question. The company didn't disperse the funds for 4 months (in both cases) the bill collectors didn't care and hounded them to death. I think the way these companies make their profit is to collect money from you, sit on it for a few months,make money on the interest and then disperse. Opray did an article in her magazine "O" a few years ago. It was about a legit company backed by the federal government. I'm sorry I can't direct you to it .After reading the answer above me, I may have misunderstood the question. I am speaking of the consolidation services.
what ever you do dont go with those debt conculing services, they will hurt you credit big time. "the ones that talk about settling your balance or eliminating intrest rates. bad bad bad. go to a bank get a personal loan, shop around for the best intrest rates, you have a great start never being late on payments
Good for you in making a financially stable decision. Consolidating all credit cards to make one payment does appear to be the more financially concise method. It depends on if you already own a home, or are receiving a personal loan, or if you are utilizing a credit agency, that just might affect your score. Credit counseling agencies are not always looking out in your best interest, and a personal loan can make it difficult because you have to be on time with payments and depending whom you are going through, it can be costly if you are late; but a home loan where you are taking out some money to improve your home and wiping out your credit card debt, and all other highest interest debt, can save you a bundle. Mainly because you have established credit via paying off those debts and you are reinvesting the monies into your home. Do see for yourself so that you may make the best decision for you:
http://www.fdic.gov/consumers/consumer/c... (information)
http://www.debtconsolidationcare.com/boo...
(e-book)
http://money.howstuffworks.com/credit-sc... (how credit works)
Good luck and be Safe...(smiles)
No, getting a debt consolidation loan from a bank or other financial institution will NOT hurt your credit rating and will actually help it by making the payments lower and more convenient by having only one.
Now, going through a debt counselling debt consolidation service will definitely ruin your credit rating. Only use that as a last resort before bankruptcy, if you don't qualify for a debt consolidation loan from a bank or don't see any other way of paying down your debt independantly.
Well it in itself will not hurt your credit. What hurts your credit is if you consolidate all your cards and one of them is a long history card, which could have held a lot of weight with your credit score. Since credit scores are partly generated from length of credit, by merging all of them, you would be closing out your oldest accounts. If you have one that you've had for years, you may want to consider keeping it open and just paying the balance off. Closing old tradelines is not always a good choice as far as credit score.
If you have several cards that are newer, then consolidate those cards and keep open only the oldest one!
Hope this helps!
More Related Questions & Answers...