0
Debt settlement will have some bad effect on your credit. When a debt is settled for less than its full value, the creditor will note that on your credit report. The damage is much less than you'd experience with bankruptcy or default, and in most cases your credit will improve within a couple of years.
Wiki User
∙ 15y ago
Add your answer:
Earn +20 pts
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.
Is the word settlement as bad as bankruptcy in your credit record?
The word settlement is considered negative on your credit report. With a settlement, you are settling for less then the total amount due. Like bankruptcy, settlements will remain on your credit report for several years.
If a debt on your credit report says 'bad debt write off ' can the creditor still sue you or collect the money?
= If your credit report reports that you have a bad debt write-off, then it means that the original creditor has written off the debt, but they can still sell the rights to the debt to a collection agency and they can contact you and take legal action.
What is the difference between debt settlement vs bankruptcy?
There is a subtle difference between debt settlement and bankruptcy. Debt settlement allows a person to pay off some of their debt with their creditors. Bankruptcy claims do not result in payment of the debt. Either practice creates bad credit scores for the consumer.
How can one go about starting a credit card debt settlement?
You need to get in contact with your credit card company and make an agreement on how you are going to pay back your debts. The cost to doing a credits card debt settlement is that you end up with a very bad credit score.
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.
Is a bad debt erased after 7 years?
No it is NOT! You have to get your credit report to see when the creditor last updated their report to the credit reporting agency. If the creditor chooses to report this bad debt every month than your bad debt will only be erased from the last update. For example: You have a bad debt from a Sears credit card from Jan of 2010. Each month Sears has reported your bad debt to Trans Union or one of the other agencies. The new date is from the last time they updated your credit report NOT from Jan of 2010. They can update it every month for the next 20 years and it will stay as a bad debt and ruin your credit report score. Legal to do it too.
Is the word settlement as bad as bankruptcy in your credit record?
The word settlement is considered negative on your credit report. With a settlement, you are settling for less then the total amount due. Like bankruptcy, settlements will remain on your credit report for several years.
How do you calculate the Bad Debt Expense on the income statement report?
credit the account receivable and debit the bad debt expense.
How long is bad credit on credit report?
7 to 11 years depending on debt to earning ratio
If a debt on your credit report says 'bad debt write off ' can the creditor still sue you or collect the money?
= If your credit report reports that you have a bad debt write-off, then it means that the original creditor has written off the debt, but they can still sell the rights to the debt to a collection agency and they can contact you and take legal action.
What is the difference between debt settlement vs bankruptcy?
There is a subtle difference between debt settlement and bankruptcy. Debt settlement allows a person to pay off some of their debt with their creditors. Bankruptcy claims do not result in payment of the debt. Either practice creates bad credit scores for the consumer.
How can one go about starting a credit card debt settlement?
You need to get in contact with your credit card company and make an agreement on how you are going to pay back your debts. The cost to doing a credits card debt settlement is that you end up with a very bad credit score.
How do you reverse a bad credit history after you paid a debt?
You can write the three credit reporting agencies and report the debt as paid. Usually, the debt holder will write them for you, but you should check that this has been done.
What is a bad credit report?
A report about your credit that is bad.
What companies are reliable in helping you get rid of bad debt?
Consumer Credit Companies are reliable in helping you get rid of bad debt, they contact your creditors and negotiate a settlement or monthly payments you can afford.
Will going through a debt settlement and negotiation company hurt your credit?
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/
