In the current economic times people are doing all that is possible to reduce the amount of debt they have. Debt consolation has become very common. This can be explained as taking a single debt to pay the existing several debts that the individual may be having. This, however, does not mean that your debts have been cancelled. You will need to pay this debt in a single controllable debt. It is a good ideal for people with good credit reports. It may, however, affect your credit report depending on the type of debt consolidation you take.
In most cases, people seeking to take debt settlement loans have a bad credit report. It is therefore necessary that you consult the free credit repairing agencies before considering taking debt consolation. Debt settlement may affect your credit score positively or negatively depending on the type of debt consolation loan you take.
Generally you can repair your credit by ensuring that you pay your credit cards on time and making sure you do not add more to your debt by taking more of the credit cards. When considering debt consolation as a way of repairing your credit, it is tricky since closing credit cards might have an effect on the credit score. At the same time if you keep more of your credit cards open it is an indicator that there is available credit hence it will increase your score. This will really confuse you and that's why the services offered by credit repairing companies would be very necessary. Consult them for advice before considering taking debt consolation.
It has been noted that the effect on your credit score is entirely dependent on the type of debt consolidation that you decide to take. Debt settlement loans that make it possible for you to pay all your debt and still maintain your account will not affect the credit score in a negative way. On the other hand if the debt settlement maintains that you close the account it will affect them and at that negatively. Therefore look for free credit repair agencies to advice you on what to do.
0 Comments:
Post a Comment