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While you may qualify for a debt consolidation loan with bad credit, you'll likely pay more in interest rates. By taking a few months to improve your credit, you could boost your odds of approval for debt consolidation loans and other types of credit and with lower interest rates.
Debt Management Plans Your credit score is not a factor in qualifying. Debt management plans may have an initial negative impact on credit score, but as payments are made, your credit score should improve, and your debt will be paid down.
Every lender sets its own guidelines when it comes to minimum credit score requirements for debt consolidation loans. However, it's likely lenders will require a minimum score between 580 and 680.
Credit counseling or debt management plan. If you've fallen into debt, you could contact a nonprofit credit counseling agency that helps people negotiate with creditors and creates a debt management plan. Those debt management plans simplify your monthly debt payment, much like a consolidation loan does.
How to qualify for debt consolidation Check credit score. You'll typically need a credit score of at least 700 to qualify for a debt consolidation loan with a competitive interest rate. ... List out debts and payments. ... Compare lenders. ... Apply for loan. ... Close loans and make payments.