Consolidating debt hurt credit score

In any case, the best option for you depends on your credit score and profile, as well as your debt-to-income ratio.

» MORE: 4 ways to consolidate debt Use the calculator below to see whether or not it makes sense for you to consolidate.

Here’s a scenario when consolidation makes sense: Say you have four credit cards with interest rates ranging from 18.99% to 24.99%.

Conversely, making minimum payments on credit cards could mean months or years before they’re paid off, all while accruing more interest than the initial principal.Consolidation isn’t a silver bullet for debt problems.It doesn’t address excessive spending habits that create debt in the first place.To come out ahead, you need to find a consolidation loan with a low interest rate and a reasonable term.You can consolidate using a personal loan or a balance transfer credit card.

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