Question: Does debt settlement help credit scores?
Answer: In most cases, debt settlement plans tell you to stop paying your debts to the creditors and instead deposit the money into a separate bank account created for your debt negotiator to use as leverage to settle with the credit companies once you have 40-50% of the outstanding balance saved. This type of debt settlement usually will hinder your credit scores in short term. However, in the long run, debt settlement will look better than consumer credit counseling or bankruptcy if you hire an effective credit repair company.
6 Comments until now
hey man i love your site.. Your writers havethe knack for nailing the financial state from the consumer and investor perspectives. Please let me know whener you have new debt relief and mortgage related articles. – thanks
Debt settlement seems to be more appealing to homeowners because they can no longer consolidate debt with home equity loans. Cash refinancing is very difficult because most consumers do not have enough equity to qualify.
I think it is interesting how much of the “main stream” media continues to villanize debt settlement companies. You guys don’t seem to be worried, but then again you do help people negotiate their debt. Please refer any of your homowner clients that need loan modifications. Keep the faith!
Credit card debt continues to hurt American families. Consolidate or settle you credit card debt immediately. Eliminate the compounding interest and become debt free!
If you have lower credit scores, consider FHA mortgages. FHA offers a great rate even if you need a bad credit home loan for purchase or refinancing.
The Treasury dept. and Federal Reserve instigated a big rate cut that mandates that mortgage lenders provides refinance, purchase loans and home equity lines at low rate levels!
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