Does consolidating your credit cards affect your credit
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However, federal PLUS loans do require that borrowers not have an adverse credit history, which is defined by Fin Aid as “being more than 90 days late on any debt, or having any Title IV debt within the past five years subjected to default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or write-off.” For private lenders, your credit score is usually a key factor in determining not only student loan approval, but also the attached interest rate.
In other words, the better your score, the better your rate.
But if you mismanage student loan debt, your credit score could suffer—and that could have a big impact on your financial future. Do I need a good credit score to take out a student loan?
Here’s how consolidation can hurt, or help, your credit score.
When you’re striving to pay off debt, consolidating multiple loans and credit cards into one account, can be an excellent strategy.
However, one thing you can do to help alleviate some of the financial pressure is to consolidate your debt into one loan repayment plan.
There are many benefits to debt consolidation, but there are also a few drawbacks.