In fact, credit counselling services DO negatively affect your credit, and potential creditors will know that you have been in a debt management plan—credit counselling—for up to three years after the plan is settled because that is how long the credit counselling history remains on your credit report.A Canadian consumer cannot enter a debt management program such as consumer credit counselling and escape notice from present and future creditors.Consolidating all your debts into one loan might appear to make life easier but there might be much better ways of dealing with debts.
In most cases, however, debt consolidation will lead to long-term credit score gains, since it will decrease your odds of default and put you on more stable financial ground.
There are two types of debt consolidation loan: Debt consolidation loans that are secured against your home are sometimes called homeowner loans.
You might be offered a secured loan if you owe a lot of money or if you have a poor credit history.
Credit scores indicate to lenders how well you manage money and if you are likely to default on financial obligations.
Payment history along with the amount of debt you carry will have the most impact on credit scores.
Credit counselling, in particular, suffers from being widely misunderstood because of incorrect information floating around.