Debt consolidation on a credit report?

[EvasiveEF9]

Sup, IA. IA's not the best place for advice, but sometimes I get a lucky strike on things...

Anyways, I was considering taking out a debt consolidation loan to pay off my two credit cards and my student loan (all grand totaling about 4500$). It would allow me to pay off my two credit cards and put them aside, and pay off my student loan...leaving good cookies on my credit report as the debts WOULD be paid off. However, I was also wondering if a debt consolidation loan would do damage to my credit report as it IS a debt-loan. The way I see it (tends to be differently than banks) I'm paying off three loans in full, and it's not a huge loan, but it is a loan-type that's totally different from any other loan I've taken and paid off. Therefore it should be a different TYPE of credit history that would be fully paid off. But, again, the word "debt"-consolidation comes into play.

Just wondering, does anyone know what a debt consolidation type loan does to a credit report, whether good or bad? Or has anyone taken one out that would advise against for X reason?

Thanks in advance, IA.

[Tracy]

No No No. I heard this on Clark Howard on AM radio. Don't do it. He said that it's a scam and it ruins your credit. I'll see if I can find transcripts of the show.

[Tracy]

This isn't the exact one, but something similar:
http://clarkhoward.com/clarkmedia/tv/predatory_lending.html

[EvasiveEF9]

Very awesome (your help, not the article).

My situation differs from his, but I get what they're saying. It's definitely something I need to look further into. I was also reading up on wikipedia (I know, NOT the best source for information) on how debt consolidation loans work. My car isn't mine, yet, and I don't have a house, so I don't have collateral to to put up for the loan, anyways.

Just trying to find an easier situation to put myself in than trying to keep up with due dates of three bills and such.

Anyone else? Or any other ideas?

I'm not going bankrupt or anything...just in a tighter spot than I'd like to be in. But...then again, my mom raised a jew when it comes to money.

[§treet_§peed]

you might be able to get a small loan from a bank. some times for smaller amounts you don't need collateral, however i don't know if they would give you 4500 bucks the first time lol

[EvasiveEF9]

The only reason they would consider it is because I'm military with a military credit union. In addition, my credit report is stellar, and has right at 5yrs on of history.

[Random Hero]

Sell some assets.

Hell, sell crack if you have to.

Debt free is the only way!

[Tracy]

Clark said that what they do is ask you for money up front for their advise and services. He said that if anyone ever asks you to do this, that is a sign. Then they tell you to not pay any of your bills for 3 months (because this is the point when collections companies are ready to start a settlement agreement). Then at this point they settle the debt for you for a % on the dollar (which by the way, after 3 months, you can negotiate all by yourself without their help or input). They make it sound like they are hooking you up, but the 3 months that you wait makes all of the debt go on your credit.

[Tracy]

http://www.bankrate.com/brm/news/Financial_Literacy/debt_management/Clark_Howard_on_debt_a1.asp?caret=87d here's another article.

[ironchef]

If you're debt only totals to $4,500, I'd just sit tight and pay as much as you can every month. Another thing to check is to see which card how a lower interest, and pay the minimum on that for a little while, and pay the maximum on the higher interest one. Typically student loans are about 5-6%, and it seems like your loan amount is fairly minimal, so you won't be racking up that much in interest there. I would focus on the credit cards first, if I were you.

[redrumracer]

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