One of the primary reasons people fear enrolling into a debt settlement program is that they fear credit damage. This article examines how and why debt settlement can hurt one0s credit score and the expected damage from utilizing such a service.
Debt settlement itself does not hurt one0s credit. Unlike bankruptcy, it does not appear as separate listing on one0s credit report that independently affects one0s scores. Therefore it is not the service itself but the requirements of the service that can do the credit damage.
Creditors are willing to settle because a client cannot afford payments and is likely to be unable to pay anything and may even go bankrupt. Therefore to 0prove0 this hardship, debts must be at least 90 days late before a creditor would consider settling the debt. It is these lates and the potential new collection listings if and when the debt goes into collections that create the credit damage. It is noteworthy that many clients that consider debt settlement already have lates and collections on their accounts due to hardship and therefore for the most part the credit damage is already done and therefore debt settlement is not likely to make the struggling person0s […]

Full Article At: KnowHow-Now.com Articles

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