Debt Settlement and Your Credit Score: Friends or Foes?

Sometimes it seems as though credit scores are the bane of the debtor’s existence. Once you encounter some difficulty in making payments, your credit score is adversely affected, which can have a detrimental impact on many aspects of life. A bad credit score can make it difficult to get certain jobs, find housing, and obtain other sources of credit, such as a mortgage or a car loan. Because a bad credit score certainly isn’t the easiest thing in the world to remedy, many people with debt become leery of any solutions that might worsen their credit. After all, the last thing you want to do is cause yourself more problems.

However, in some cases, things will have to get worse before they can get better. Debt settlement is a great option to help you get out of debt. Our debt settlement program offers you the chance to have debt relief in as little as one year. You will have a debt settlement coach who will deal with your creditors and help you every step of the way. Unfortunately, though, your credit may be negatively affected.

The very nature of a debt settlement program is one of the reasons why your credit will be affected. After enrolling, you will be instructed to stop directly paying your creditors. This is what will be initially detrimental to your credit score, but it is part of the process that you must go through to obtain a greater good. Instead, you will pay one lower monthly payment, and our representatives will negotiate a full-sum payoff of your debt. This sum is usually 50% less than what you owe.

Although your credit may suffer at the onset of a debt settlement program, the end result of the program is obviously great for your credit score. After all, having little or no debt certainly helps when it comes to obtaining and then maintaining a good credit score. Before deciding to use our debt settlement program, it is imperative that you analyze the pros and cons. One thing to consider is that people who are struggling with debt and defaulting on their payments will already have a credit score that is unfavorable. Any attempt to keep your credit score from getting worse will also do nothing to help you get out of debt, unless your income is significantly increased. And trying to maintain your not-so-great score certainly won’t help you actually improve your credit. In the long run, debt settlement actually improves your credit score because it is a means for you to eliminate the factor that is causing your bad score—your debt.

Credit Scores after Debt Settlement

After completing a debt settlement program, you can begin work on rebuilding your credit. Although this may be challenging, keep in mind that the fact that you are debt free will be immensely helpful in rebuilding your credit. You will also be able to follow the budget laid out for you by our debt settlement coaches and use the money management skills that you learned during the debt settlement program.

Although the process of debt settlement may make your credit score suffer initially, it is a great way to get out a debt, and being debt-free is the key to being financially stable. Please take the time to fill out our online no obligation debt settlement form, and see how we can help you eliminate your debt in 12 to 36 months!

Offering Professional Debt Settlement Help to 50 US States

List of States where we offer debt settlement