Consolidating loans bad credit rating
Consolidating your bills will help you reduce bill clutter, and will possibly provide lower rates. P2P Credit makes applying for a debt consolidation loan hassle free.
Borrowers can use a debt consolidation loan to pay off debts and replace them with a single loan.With a debt consolidation loan, you borrow enough money to pay off your other unsecured debts and wind up with 1 monthly payment for the personal loan.RATE SEARCH: Interested in a personal loan for debt consolidation? Lenders base their loan decisions on your credit history, which goes into a credit-scoring model to come up with your credit score.Virtually all credit scoring models take into account the amount of your revolving balances in comparison to your available credit limits.The closer your balances get to your credit limits (known as “utilization”), the more this factor will hurt your scores.In addition, they may take into account the payment on the new debt as well.
Even though your plan may be to use the new loan to pay off your other debts, and then pay the new loan off as fast as you can, the new lender is wondering what will happen if you consolidate and pay off your credit cards, and then run up new balances.
Borrowing money to pay the bills can make sense in that you're staying current on your financial obligations.
That will keep your credit history from getting worse.
Before spending hours searching for the most affordable debt consolidation loan, you should save your time and money by applying with P2P Credit.
Having less than perfect credit shouldn't stop you from receiving the benefits of consolidating your debts.
If you are nearly maxed out on one or more credit cards, your credit scores have no doubt taken a hit.