Debt Settlement – the downside
What can you do when the bills due amount exceed what you earn as income? You have two ways to go;
1. Declare bankruptcy and fight your way to a good credit score through the following 7-10 years; or
2. Sign up with a debt settlement agency that can help you come out from under your debts.
From the above, debt settlement looks like a good thing; however, did you know the debt settlement is seen as high risk by creditors? This is entered on your credit report and will stay there for 7 years.
Do you also know that when you take this step the credit bureaus decrease you credit score? It will take 12-24 months to undo the damage done by debt settlement to your credit score.
While debt settlement may be a better alternative to bankruptcy, consider the downside before you taking action.
