How Many Years Will It Take To Clear In Your Record If You Apply For Debt Settlement?

How Debt Settlement Affects Your Credit Report

Debt settlement can be a great option for those struggling with credit card debt. For one, many debtors can pay off their credit card debt balance by paying somewhere around 50 percent of what they owe. Creditors are open to this option when dealing with customers who are clearly struggling to make payments and in danger of declaring bankruptcy. However, it’s important to remember that debt settlement can also have a negative impact on your credit report and appear there for anywhere from seven to ten years after you settle your debt with a creditor. Often, a creditor will mark your debt as “Settled” or “Paid–As Agreed,” which automatically send up red flags for future creditors that you may wish to deal with. Therefore, you should definitely consider this before settling your debt with a creditor.

Using Debt Settlement Properly

Though settling your debt can negatively impact your credit score and stay on your record for up to a decade, that doesn’t mean you shouldn’t consider it a good option. In many cases, those who qualify for debt settlement are having trouble with debt anyway and may be at risk to damage their credit score anyway. Rather than continue to make late payments on credit card debt or declare bankruptcy (which stays on your credit report for 7-10 years and just about always ensures that you’ll be ineligible to receive any sort of loan during that time period), debt settlement can help save you from doing further damage to your credit report. If you choose to use it, hire a qualified debt settlement company that’s certified by the Better Business Bureau to negotiate hard to get you the best settlement.

Another Option For Your Debt

Debt settlement isn’t your only option. If you’d rather not have it on your credit report for the next few years, consider using debt consolidation to pay off your debt. Debt consolidation brings all the credit card debt you have together and usually offers you a better interest rate on it. It also doesn’t do much damage to your credit score and will be just as effective at helping you to pay down your debt over time. In general, debt settlement can help you get back on your feet–but you need to make sure that you use it properly and don’t hurt yourself in the long run.

Related posts:

1. How Will Debt Settlement Affect My Credit Report?
2. How To Clear Debt
3. How Bad Is Debt Settlement On Your Credit Report? How Many Points?
4. Why Debt Settlement?
5. What Is The Difference Between Debt Consolidation And Debt Settlement?