Debt settlement vs debt management - Which is the right choice?

Settling debt probably won't hurt your credit score but those late payments will probably stay on your credit report for 7 years. You may even owe the IRS money on forgiven debt.

Hello, I am currently enrolled with Debt Free Associates, CA. They will soon be trying to take my 3rd payment. I freaked out tonight because every dollar I have put in they have deducted as Customer fees as of today's statement. I have a large amount debt and now have given them $2163.82. I am approx 2 months late on multiple cards with large balances. I am overwhelmed with all of the info on this forum. I have this awful feeling I am being scammed. My thought tonight is to cancel with DFA and take the $982 per month and sock it away to settle one account at a time. Does this make sense? I really appreciate your help. Thank you!

If you are already 4 months behind, your score is already hurt. The question you should ask yourself, how long do you want to stay in debt. Debt settlement is a shorter process and allows your credit to be hurt for a short time. You can rebuild your score after your debt are paid.

The rule is, you may have to pay tax on any forgiven amount greater than $600 dollars. However , there is a IRS form 982 that you can get to explain why you were in a program which may exempt you from having to pay back the forgiven amount

I owe line of credit 68K and I was out of country for 8 months, last four months I have not paid a dime because all the money I left in my account was gone already towards payment. Now I am out of Job and no money coming in. How can I deal with this situation? What if I don't pay them at all what will be the worst case scenerio we are talking about?