Doesn't using the debt consolidation (credit management) programs look bad on your credit report? A mortgage company told me that it's next to being bankrupt. I always thought that it's better to pay off your bills, than to stay in debt. My DH and I wanted to do that, but we keep hearing how horrible it is to have on your report, and it'll hurt our chances of ever being able to buy a house? What do you think?
HearzBellz
Posted:
Member since
Re: Debt Consolidation...
The way I see it... it is no worse than having late payments & such. I would get it after the mortgage though.
Jenn524
Posted:
Member since
Re: Debt Consolidation...
Are you delinquent in paying your bills or is there just a lot of debt? Banks will evaluate that. Debt Consolidation doesn't look great because it shows that you had problems paying bills in the past and you needed help to get out of your debt. I have to be honest... I review credit reports and I'd rather see someone who had a rough couple of months but managed to pay things off by themselves. It shows that the person can handle getting themselves out of debt. A mortgage company will look at how you handle previous debt and will evaluate how adding more debt on will affect you.
Also as far as debt goes they don't look so much as what your total debt is as compared to what you have to pay monthly towards that debt. If you have low monthly payments, the Bank wont care as much.
Feel free to FM me if you want to ask me more questions. This is a big part of what I do for a living so I'd be happy to help answer questions.
Marcela1654
Posted:
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Re: Debt Consolidation...
This doesn't apply to school loan consolidations does it? I haven't even started paying my school loans back yet. I'm still in my grace period. If I consolidate (Perkins and Federal Subsidized) I get a 3.5% FIXED interest. And if I don't it's at 5% VARIABLE rate. Thanks!
Jenn524
Posted:
Member since
Re: Debt Consolidation...
Consolidating student loans would be fine. That just shows that you're looking to get a better rate. It should not reflect poorly on your credit report.
