Does joining a credit counseling service hurt your credit?

Question

I recently joined a credit counseling service because I am a college student that got way in over my head with credit cards. I was painted into a corner and had nowhere else to turn- so first and foremost I do not regret doing it. When my dad found out, though, he went ballistic. He said I basically had just filed for "partial bankruptcy" and it would kill my credit score. I've read other accounts that say that credit counseling shouldn't hurt your credit. I really want a definitive answer on this. Does it hurt your credit or not? And if so, how badly?

Answer 1

It does not affect your credit to use a credit counseling service.

Go to myfico.com and read "what's not in my credit score" And it will clearly state that doing credit counseling does not effect your credit score. here is the link.

http://www.myfico.com/CreditEducation/WhatsNotInYourScore.aspx

Answer 2

Debt counseling will harm your credit interior 3 months. it may drop your credit via 50 factors. the superb thank you to consolidate funds owed is thru a 2d loan or a house fairness line of credit. Self debt administration is the superb way, yet while it would not artwork, you are able to seek for counseling help. Many credit counseling businesses are nonprofit and artwork with you to remedy your economic issues. yet be conscious that, only because of the fact a company says it’s “nonprofit,” there’s no assure that its centers are unfastened, low priced, or maybe valid. in actuality, some credit counseling businesses cost extreme expenses, which may well be hidden, or urge shoppers to make “voluntary” contributions that would reason extra debt. maximum credit counselors furnish centers by way of close by places of work, the information superhighway, or on the telephone. If possible, detect a company that provides in-man or woman counseling. Many universities, militia bases, credit unions, housing government, and branches of the U.S. Cooperative Extension provider perform nonprofit credit counseling classes. Your economic employer, close by shopper secure practices enterprise, and acquaintances and kinfolk additionally may well be good substances of suggestion and referrals. yet be careful with some credit counseling scams on the information superhighway.

Answer 3

If you are in a debt management program, yes it will affect your credit score just like a bankruptcy. The good news is that when you get everything paid off, your score will rebound with no after effects.

If you are just in credit counseling where they are assisting in getting interest rates reduced but you are making your own payments, your score may or may not take a hit. But once again, when the debts are paid off, you'll have a decent credit score.

The most important thing is that you learn better financial management and live within your means.

Answer 4

Listen to your Dad, he is right. Going into credit counseling will definitely hurt your credit.