Though a debt consolidation loan may negatively affect your credit score in the short term, it can work to improve it in the long run. NFCU will run a hard inquiry on your credit, which dings it about 5-10 points. This inquiry will only last about 2 years. However, your credit utilization ratio will not necessarily be affected, as you’ve still got that same amount of debt to pay off. At the same time, many debt-free stories start this way. On-time payments can positively raise your credit score as long as you keep up a good payment history.