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cpereyra1
Posts: 17
Registered: ‎10-29-2012
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Just applied to consolidate student loans, what should I do?

[ Edited ]

I recently applied to consolidate my student loans I have about 9 of them totaling about 30K, I have about a week to decide to continue consolidating the loans or cancel it.  If I am correct this would affect my account age because these loans are from 2008,2009,2010,2011 so consolidating would get rid of them an decrease my account age and average account age correct?  and show a new loan with a higher balance.  Would the old loans should payed and stay on the credit report or would they fall off?  My real question is, should I continue consolidating or should I cancel it?  My current credit score with no baddies, about 4 year credit history and one credit card with 9% util is around 670.

 

Thank you all for the help.

Senior Contributor
Walt_K
Posts: 3,065
Registered: ‎11-02-2009
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Re: Just applied to consolidate student loans, what should I do?

The old loans will remain on your credit report and should show paid (I had to contact one of mine to get them to update after it had been transferred).  Most items remain on for 10 years after being closed. 

 

The new loan will appear as a new tradeline so it will lower your AAoA.  However, you really shouldn't concern yourself too much with this.  Consolidating your student loans should be less about FICO and more focused on whether you are getting a good interest rate, lower monthly payment, making things easier by making only one payment, etc. 


Starting Score: ~500 (12/01/2008)
Current Score: EQ 681 (04/05/13); TU 98 728 (01/06/12), TU 08? 760 (provided by Barclay 1/2/14), TU 04 728 (lender pull 01/12/12); EX 742 (lender pull 01/12/12)
Goal Score: 720


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Established Contributor
distantarray
Posts: 2,112
Registered: ‎09-25-2011
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Re: Just applied to consolidate student loans, what should I do?


Walt_K wrote:

The old loans will remain on your credit report and should show paid (I had to contact one of mine to get them to update after it had been transferred).  Most items remain on for 10 years after being closed. 

 

The new loan will appear as a new tradeline so it will lower your AAoA.  However, you really shouldn't concern yourself too much with this.  Consolidating your student loans should be less about FICO and more focused on whether you are getting a good interest rate, lower monthly payment, making things easier by making only one payment, etc. 


^ this , as long as your not in the market for a house or a car in the next couple months don't even worry about Fico, get your **bleep** done and you'll never have a problem, scores will rise regardless, you'll get better credit scores by taking the saved interest rates and putting them towards better use like adding to a secured card to increase your limits.


total credit limits $108,400 Credit scores Ex 728 EQ 738 TU 758
Established Contributor
calihlove75
Posts: 791
Registered: ‎05-16-2012
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Re: Just applied to consolidate student loans, what should I do?

I am about to do the same thing and I don't think it is as bad as it seems. From what I know, the old loans will be closed and paid- 0 balance- and will continue to report and be factored into AAOA for I think 10 years,  and one would report as new. I honestly think it will look better than seeing a bunch of loans scattered with balances and will be easier to keep track of since there will only be one.


100% Ficos: EX 762, TU 767, EQ 762 Inquiries last 1 year/6 months: EX-0/0, TU- 0/0, EQ-1/1~ last credit card app 6/24/13- New car loan 3/8/2014
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Frequent Contributor
Autumnslight
Posts: 311
Registered: ‎07-08-2012
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Re: Just applied to consolidate student loans, what should I do?

I just consolidated my loans this past month. The old loans are still there, but show a zero balance and closed. The new loan is now reporting as one tradeline. It lowered my AAoA a little bit, but the old loans are still there for ten more years to help offset it. Also, I believe FICO dings you for having a lot of open installment loans with a balance, so consolidating them down to one could possibly have a positive effect in that regard.

Scores:
07/29/12: EX FICO (Amex) 684 | EQ MyFICO 631 | TU Walmart 695
Current: EX FICO (MyFICO) 733 | EQ (MyFICO) 683 | TU (Walmart) 745

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