Will debt counseling hurt your credit?

Getting debt counseling is a good thing and shows your willingness to take care of your debt in a responsible way. If you are undergoing debt counseling, a notation to that effect may be appear on your credit report. This does not affect your credit score but how each creditor views this notation, differs from creditor to creditor. While it may seem unfair, there are some creditors who view debt counseling as a negative to your credit worthiness. In their view, the fact that you are in an unmanageable debt situation is not a good sign, unless you can convince them otherwise. So the reality is debt counseling may hurt your credit, depending on the subjectivity of the creditor.


Debt counseling will never hurt your credit, since it is an educational activity. If you choose to enroll in a debt management program, that does not hurt your credit either. What could hurt your credit is closing any accounts that have substantial available credit. Other than that, your credit generally improves over the life of the debt management program.