How bad does credit counseling affect credit score?

It hurts you bad, but not as bad as debt settlement or bankruptcy.

1. All your credit card accounts are closed, most likely with high balances or maybe over limit also, which hits your credit hard.

2. Your 1st payment does not go to your creditors, so u get a running 30 day late, which can run for years, only some creditors reage = make current after x months.