Will Consolidating my student loans help my credit score?

Question

I had 6 student loans equaling a total of $20,000 from 2 different companies. My mistake was i didn't put them into forebarence in time i was late about 2 months. One of the companies wiped it off my credit, the other showed that i had been late. I decided to consolidate my loans with the company that wiped it off my credit. My question is will this help my credit because with the company that had the late payment the loans will have been paid off and with the other i will have been current on all of my payments? Thanks for the help.

Answer 1

Your loan won't show as paid off .. but rather as "sold to another lender". Also, the detail will also still show for the time you had a loan with them. (ie: payments late, highest balance, etc)

Your credit score will increase w/on-time payments ... not by changing the owner of a loan. Prior to consolidating, I was surprised to see just how many different lenders once owned my student loans -- though I took them all out from the same company. And all those sales amounst the lenders did not affect the credit score.

Answer 2

no matter if you consolidate, your previous loans will nonetheless somewhat be on your credit record. they must be listed as paid, yet they are going to nonetheless be there. i must be VERY leery about consolidation... organizations in elementary words do issues if it makes money for them... typically situations your funds become a lot less, yet you pastime price is more advantageous or the size of time to pay them will become longer (this giving them more advantageous pastime over the technique the loan). in the journey that your loans are federal loans, once consolidated they're actually not federal loans and haven't any of the federal forgiveness rules in position because. save wisely.

Answer 3

delinquent accounts that still have a balance are the most devastating to your credit. they will continue to be categorized as "delinquency tradelines". if you can get them reporting as a zero balance, then your score will improve. every month that passes and puts that account behind you, your score will get better. and after 7 years, it will be gone altogether. if you DONT pay it off, the delinquency trade will be on there for the time it takes you to payoff the account, and add 7 years to the date its paid off. start the clock sooner than later.

so, yes, i would say that consolidating them would be helpful to raising your score. also, you'll probably be able to get a lower payment for yourself by consolidating them together.