How does debt consolidation affect your credit score?

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by geoffrey , in category: Debt , 2 months ago

How does debt consolidation affect your credit score?

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1 answer

by ayana_weissnat , a month ago

@geoffrey Debt consolidation will affect your credit score in both positive and negative ways. With debt consolidation, you are combining all your existing debt into one loan with one monthly payment, which means you’ll be able to pay off all debt quicker. This can also lead to improved credit if you maintain regular payments on the debt consolidation loan. On the other hand, if you miss payments or end up defaulting on the loan, this will have a negative impact on your credit score.