Those who have a lot of debt will often believe that their only option is bankruptcy. However, some people are so far in debt that bankruptcy is the only option that they have. Yet, bankruptcy is one of the most harmful when it comes to how it effects your credit score, it is best to look into other relief options first and how they will affect your credit score.
There will not be any debt solution that will be free of any consequences. However, there are some solutions that are not as harmful to your credit than others. Credit counseling is far from bankruptcy when it comes to having a negative impact on your credit score. Debt settlement is also not as hurtful to your credit score unlike consumer proposal or bankruptcy.
Debt Settlement Basics
Debt settlement are for those who are wanting to settle debts with the creditors for less than what it actually owed. It is best for those who owe more than $10,000 but have not reached a point for bankruptcy or consumer proposal. A professional can help you to decide if debt settlement is best for you. If you have some money that is already saved up or you will have some in the next few months, then debt settlement is great because creditors like to settle debts for lump sums, and you can settle for just pennies on a dollar.
Credit Impact from Debt Settlement
How debt settlement will affect your credit is going to depend on your situation. The more that a creditor writes off of your debt, the bigger the negative impact will be. It is almost always best to get a debt settlement professional to negotiate for you and try to get the best options for you. Your debt relief company can run the numbers and be sure that you are getting the best offer for your credit score. This is often one that will not leave you with a bad score or hurting financially.
If you have been having trouble making payments, then you have already felt the negative impact of charges and late fees on your debt total and financial situation. You need to know that late payments make you less attractive to any creditors the longer that you are past due on the payments. However, debt settlement will not clear the credit report of late payments, it can keep you from getting more late payments on a debt that is due.
Your credit score will always see improvement if your debts are settled. Being able to get the debts settled will improve the debt to income ratio, which is a big influence on your credit score. If debt settlement is the best option for you, you do not need to put it off. The faster that you are able to settle your debts, the better that your credit score will be. When you have an improved credit score, you will get great interest rates on new credit and even find that it is easier to get loans and so much more.
Get Help That You Needed
The best way that you can find out that debt settlement is right for you, is to talk to a professional and look at the relief options and your finances. To get started, just fill out the debt relief form below.
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