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If you have 3 credit cards, each with a credit limit of ,000, and you have

If you have 3 credit cards, each with a credit limit of $5,000, and you have $1,000 of debt on each card, then your total credit limit is $15,000 and your total debt is $3,000 – which means that your credit utilization is 20%.So how do the different types of debt consolidation affect your credit utilization?Of course the problem is that there is an inherent temptation in leaving those cards open. Check your rate using Ready For Zero's free debt consolidation tool.

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If you have 3 credit cards, each with a credit limit of $5,000, and you have $1,000 of debt on each card, then your total credit limit is $15,000 and your total debt is $3,000 – which means that your credit utilization is 20%.

,000 of debt on each card, then your total credit limit is ,000 and your total debt is ,000 – which means that your credit utilization is 20%.So how do the different types of debt consolidation affect your credit utilization?Of course the problem is that there is an inherent temptation in leaving those cards open. Check your rate using Ready For Zero's free debt consolidation tool.

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The hard inquiry will lower your credit score by a few points and stays on your credit report for two years.

However, this small hit to your credit is not necessarily a reason not to do debt consolidation.

” but also in giving you tools to decide what the best course of action is in your particular situation.

Remember, when considering whether to do debt consolidation, compare how these factors would be affected by the loan: If you have any questions about the information above and how it might relate to your own individual situation, please post a comment below and we’ll do our best to answer it.

Now you have ,000 on your new card, and it has a credit limit of ,000.

You also still have your old cards (with a total credit limit of ,000), so your total credit limit is now ,000 and your credit utilization is 15%.

A bigger concern than the hard credit inquiry is how the debt consolidation might affect your credit utilization.

The phrase “credit utilization” simply means the percentage of your available credit that you are currently using.

After all, paying off your debt will help improve your credit score in the long run and save you plenty of money in interest and fees!

——— Hopefully the information above is helpful not only in answering the question “does debt consolidation hurt your credit score?

” To answer that, you need to understand how credit reports and credit scores work.