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Yes, if you do not follow through with it to the Letter!
Chances are if you are in position to use this method of debt elimination, your credit is already shot. If you still have good credit, settlement is a silly option because it destroys the credit rating on two fronts. First, creditors won't consider settling with you until you are at least 90-120 days past due. This kills your payment history and drops your score way down. Second, the creditor can really stick it to you for the next 7 years based on the notation added upon completing settlement on the account. Anything other than "paid in full" is bad. "Paid as agreed" is not good, and "paid -- charge off" or "paid -- collections" are both really bad. Finally, anything with the word "settled" in it goes in your credit file as an "R-9" code, which is a half-step above bankruptcy. Future creditors will deem you an extreme risk. The trick is to negotiate with creditors just what language they will use in their final report -- and get it in writing before giving them any funds.
Your credit report summarizes your track record for paying off credit accounts. Specifically, it displays information on any late payments or outstanding debts on these accounts. Any difficulty you have in making payments for your accounts will show up in your report and could negatively affect your score.
Debt settlement is when a person enlists the help of a debt settlement agency to negotiate lower monthly payments with a creditor for which there is a large, outstanding debt. Needing debt settlement usually means a person is having difficulty managing credit accounts and debt. Because of this, debt settlement could look bad on a credit report and could possibly have a negative affect on a credit score.
FYI: The credit reporting agency Equifax provides a helpful website with information on credit. It's written for the general public, so it's very easy to read.
http://learn.equifax.com/
What else can I help you with?
How does working with a credit card settlement company affect your credit score?
It is recommended that you pay an old debt through the original creditor. Credit settlement companies are out to make a profit and they will negotiate terms that are not true. Also, it is possible that you can pay the settlement company but still owe the original creditor. It has happened to me. The negative information reported by the credit card settlement company will affect your score negatively.
Where can one find out more about credit card debt negotiation settlement?
One can find more information about credit card debt negotiation settlements in different consumer guides. BeginnersInvest offers an article named "How to Negotiate a Credit Card Debt Settlement". That article handles the topic more in depth.
Can a collection agency remove a collection from your credit report?
Yes, a collection agency can remove a collection from your credit report if they agree to delete it as part of a settlement or negotiation.
Is settlement good or bad on credit report?
Debt settlement is good for your credit rating. Just settle the debt and move on. Do not use a debt settlement company, ever.
What point can you request a settlement on credit card debt?
Settlement usually occurs when the account is past due and has been closed. You can either try to settle with the credit card company, or the debt collector that the credit company sold the account to.
How does working with a credit card settlement company affect your credit score?
It is recommended that you pay an old debt through the original creditor. Credit settlement companies are out to make a profit and they will negotiate terms that are not true. Also, it is possible that you can pay the settlement company but still owe the original creditor. It has happened to me. The negative information reported by the credit card settlement company will affect your score negatively.
You received a settlement offer from a credit card company meanwhile it was turned over to a collections group.How do you get the collections group to turn the case back to credit card company?
If the collectors are an agency acting for the original creditor you can contact the OC to ascertain if the settlement offer is still valid. If the collector is a third pary agency that has purchased the account from the OC, any settlement negotiation will have to be done with them.
Where can one find out more about credit card debt negotiation settlement?
One can find more information about credit card debt negotiation settlements in different consumer guides. BeginnersInvest offers an article named "How to Negotiate a Credit Card Debt Settlement". That article handles the topic more in depth.
What are some of the best debt negotiation companies?
There are many good debt negotiation companies. Some of the best debt negotiation companies are Freedom Debt Relief, Credit Care Corporation and Debt Settlement USA.
Can a collection agency remove a collection from your credit report?
Yes, a collection agency can remove a collection from your credit report if they agree to delete it as part of a settlement or negotiation.
Is settlement good or bad on credit report?
Debt settlement is good for your credit rating. Just settle the debt and move on. Do not use a debt settlement company, ever.
What point can you request a settlement on credit card debt?
Settlement usually occurs when the account is past due and has been closed. You can either try to settle with the credit card company, or the debt collector that the credit company sold the account to.
Should you get enrolled in Debt settlement program to be debt free?
Debt settlement helps you in reducing your credit card debt & other unsecured debts. yourdebtfreeadvisor.com provides credit card debt settlement,tailor made plans for debt negotiation and giving you relief from your debts & taking the financial burden off your shoulder.
What happens if the credit card company won't except a settlement?
Whatcanidoifacreditorwontexcept my settlementandsuesme
What are the specifics of credit card debt settlement?
You should get a hold of a debt consolidator who will then go to bat for you with your credit card companies. They will work out a settlement that can be agreed upon by both the credit card company and yourself.
Can you lessen your credit card debts?
You can through debt settlement, but you will also ding your credit score. Now there is also credit card negotiation, which is negotiating a deal to lower your credit card interest rates. This process will lower your interest rate, lower your minimum payment, and allow you to pay off your debt faster. This is a much better alternative to debt settlement. Hope this helps. Any questions you can call us at 954 300 1053 or visit us at http://www.myplasticwallet.com
What does a debt negotiation company do?
Debt negotiation companies work with creditors and the debtor to achieve partial payment in order to discharge a debt. For example if a person owes $10,000 on their credit card, the negotiation company will approach the credit card company and propose that a one time payment of $4,000 will discharge the debt, rather than having a default on the entire amount. Such companies will usually do such work for a flat fee or for a percent of the debt discharged (e.g. 5% of the $6,000 they saved the debtor).
