Consolidating debt without

When you’re ready to get out of debt, sometimes it’s hard to know which path you should take.

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

If you’re not familiar with the process, here’s a very brief explanation: Your credit report contains information about all the credit accounts you’ve ever had, including mortgages, auto loans, credit cards, student loans, etc.

Also included in your report is a history of the payments you’ve made on time, and those you have paid late (or not paid).

The 3 major credit bureaus (Equifax, Experian, and Trans Union) compile this information and make it available, along with your credit score, to lenders who want to find out how creditworthy you are.

In theory, debt consolidation should not have a major impact on your credit score.

However, the fact is, debt consolidation can improve or hurt your credit score.

It depends on your particular situation and your ability to pay off debt.

Here are the questions you must answer in order to figure out if debt consolidation will hurt or help your credit in the long run: There are three main ways of doing debt consolidation: Each of these three methods requires a hard inquiry on your credit, which is the same as when you apply for a new credit card, submit a rental application, or get an auto loan.

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

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