![]() If your credit is shaky, you may end up with an interest rate that's not much better than your current rates. You may not qualify for a lower interest rate: Debt consolidation only results in a lower interest rate if your credit score is strong enough to qualify for the best rates.Be sure to take these into account when weighing how much money you stand to save by consolidating. You may incur fees: Some consolidation loans carry fees, including loan origination fees, closing fees and annual fees.Keep these in mind while deciding if it's right for you: There are plenty of pros to consolidation, but there are also some cons. This frees up more available credit compared to your total credit lines, which can raise your score. By opening a new line of credit and using it to pay off your other credit accounts, you bring those accounts to a zero balance. ![]() In addition, consolidation can also help your credit by increasing your credit utilization ratio. The more you pay down your debt, the better it is for your credit score. ![]()
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