Does Debt Consolidation Hurt My Credit? What should I do?
Does Debt Consolidation Hurt My Credit? What should I do
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Every year thousands of Americans will discover that keeping up with the Joneses is about to land them in the poor house.
The phone rings day and night and on the other end is someone asking when you plan to start paying the bill. With bills mounting up and limited resources to pay them off bankruptcy may seem attractive. But there are other options.
Aurora Lillo Editor of the "Best Debt Consolidation Services" website -- http://www.ReputableDebtConsolidationCompanies.com -- pointed out;
"...There are several of products available to help those who are experiencing financial hardship. Each one comes with its own set of pluses and minuses. One popular option is a debt consolidation loan. These loans generally require some sort of collateral, real estate or some other property. For example you can tap into your home equity for the loan; turning your previously unsecured debt into a secure one..."
However, one of the main questions about this product is how it may affect your credit score and what you can do about it.
The first thing to remember is anytime your credit report receives an inquiry it will affect your rating. So while applying for a home equity loan may hurt your score for the near future, making the payments on time will elevate your rating. Agencies tend to look at the whole picture and take into account that other debts have been successfully paid in full when ratings are compiled.
If applying for this program is something that sounds attractive to you, be sure to have a plan of action. You need to someone to help you make sure that the payments on a home equity loan are manageable. Because these loans do require collateral, you could lose your home if you fail to make the payments. This will put in you a worse situation than you started off in. Talk with a certified professional to assess the tax implications of the loan. In many cases a portion of the loan is tax deductible, regardless of how you use the money. Simply put, the only thing you can do is to develop a budget and stick with it.
"...Competing financial obligations can take a toll on you as an individual and your family as a whole. The road that leads out of financial ruin is not paved in gold. With help from the right people and the right program, you can breathe a sigh of relief..." added A.Lillo.
Further information about trusted and reputable companies for debt consolidation by visiting; http://www.ReputableDebtConsolidationCompanies.com