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Frequent Contributor
Posts: 324
Registered: ‎11-18-2007
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student loan consolidation increases fico score?

I was reading on the direct loans website, and they make the claim that consolidating student loans helps to increase your fico credit score.  Is there any truth to this?  I currently have around 18 (can't remember exact number) federal loans, that i'm considering consolidating. 
Moderator Emeritus
Posts: 9,252
Registered: ‎03-19-2007
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Re: student loan consolidation increases fico score?

IMO- no
This CAN increase your credit score-
I would say most people will lose a few ponts when they first consoliate- 
# of open trades paid as agreed would be lower after consolidation-
 
I think the logic is that not having to make 18 payments every month- and not having anything get screwed up- This is where your scores can go up.
 
 

angiepharm wrote:
I was reading on the direct loans website, and they make the claim that consolidating student loans helps to increase your fico credit score.  Is there any truth to this?  I currently have around 18 (can't remember exact number) federal loans, that i'm considering consolidating. 



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Community Leader
Epic Contributor
Posts: 28,098
Registered: ‎04-01-2007
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Re: student loan consolidation increases fico score?

Not to mention that TU likes to report student loans as consumer finance loans, and having only one inaccurately labeled loan is bound to be better than having 18. :smileytongue:
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Member
Posts: 5
Registered: ‎02-28-2008
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Re: student loan consolidation increases fico score?

I consolidated my loans in Dec/January, first payment is due next week, my scores went up across the board.  More then 50 points each... Experian went from 506 to 658, I also had an inaccurate collection that was removed.  Equifax went from 598 to 643, plus my payments went down over 300 dollars.  I didn't pull transunion score to see what the increase was, but i'm sure there was an increase. 
Member
Posts: 5
Registered: ‎02-28-2008
0

Re: student loan consolidation increases fico score?

So I checked transunion today and it's 673 up from 568, I'm also paying my credit cards down to 35% or less usage.  
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