| Credit Counseling please advise |
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z970699
First Time Poster
Cash: $ 0.25
Posts: 1
Joined: 27 Sep 2008
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| Credit Counseling please advise |
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I'm hoping a few of you may be able to offer me suggestions with my current problem. Due to medical reasons I currently have $30,000 in credit card debt at roughly 28% interest. My monthly payments are about $1100. Although I consistently make my payments on time, I cannot make much more than the minimum payment. These high interest rates are killing me.
I've spoken to a credit counselor (Creditguard) and they will be able to close down and lower my 7 credit cards monthly payment by over $375, and lower the APR from 28% down to 9.99%. I will also be able to pay off the cards much sooner.
However, I'm very worried about my credit score. I currently have a score of 705 and worked very hard to get it there. How will going into credit counseling affect my score? The representative said that it will not damage my score but mortgage companies see it negatively. This is not a concern to me because I'm not planning on getting a new mortgage any time soon. Even if I do take a small hit to my credit score, wouldn't it be offset by reducing my debt load much more quickly?
Is credit counseling a good decision for me? I'm really concerned about my credit score, and I wanted to hear a viewpoint that was not from a counseling rep. Thank you for your advice.
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Sat Sep 27, 2008 5:57 pm |
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efflandt
Senior Member
Cash: $ 80.45
Posts: 401
Joined: 25 Apr 2005
Location: Elgin, IL USA
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You have to be careful about whether they are actually giving you a lower interest loan that will pay off the credit cards or doing something else.
Some just take your money and hold it (removing their fee), don't pay your creditors (trashing your credit), and then try to work out a settlement. But some creditors do not fall for that and still go after court judgments.
So make sure that you know what they are actually going to do so there are no surprises.
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Sun Sep 28, 2008 10:42 pm |
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Jefferson P
First Time Poster
Cash: $ 0.20
Posts: 1
Joined: 20 Jan 2009
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| The Impact |
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One factor that gives effect to your credit history is your credit score. This has a big impact to your credit stability. Thus, as much as possible you must always be aware about your credit score rating. And as much as necessary keep must your credit score in good rating. Reports on credit include all open accounts, balances, and late payments to the three main credit bureaus. The bureaus determine a credit score on a mathematical algorithm to determine whether or not you have good credit. Almost anything has an impact on your credit score, like your employment record, car insurance. The amount of things that impact your credit is titanic. [edit]
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Wed Jan 21, 2009 9:50 am |
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cccfree
Full Member
Cash: $ 7.80
Posts: 51
Joined: 08 Mar 2011
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From what I can gather, there is a chance that once you're in a debt management plan your credit score my temporarily drop and you won't be able to apply for anymore credit (or at least it will be difficult) while you're in a debt management plan.
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Tue Mar 08, 2011 6:10 pm |
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