Consolidating your debt may help improve your credit score so long as you make on-time payments and make serious progress lowering your total debt load. The most impactful part of your credit score (constituting 35% of your score) is your payment history.
But just how much your score might improve depends on a lot of factors and the answer is different for each person. That’s because each consumer’s credit score is affected differently when it comes to credit card consolidation depending on how many new accounts they open, whether or not they were previously late on payments, and other factors. The more negative marks on your credit report, the longer it may take to see your score improve.
Although you might see credit score changes initially, your score should improve over the long term as long as you make your payments on time every time and don’t take on extensive amounts of new debt. The same is true for debt management plans. With a debt management plan, your score might be initially affected if part of the plan is closing your old accounts (that would impact the length of credit history, another key factor in your credit score.) However, what’s most important is that your long-term credit score will improve because you’ll get a better handle on your finances, avoid late fees, and pay on time every time.