difference on credit score Debt settlement versus debt management

Technically a debt management Plan has no affect on your credit score but does show on your credit report that you are in a dmp and thus can affect you getting future credit until you have completed the program. Once you have completed a DMP it comes off your report as if you were never in that program.

A Debt Settlement program can have a major impact or non at all depending on the how your credit is when you enter the program. For someone who's bills are already several months delinquent or already charged off , it would have little or no impact . As a matter of fact in the long run it should improve your credit profile by improving the debt to income to income ratio and getting rid of the delinquent debt which makes up 30% of your fico score. On the other hand , someone who's bills are all current who joins a settlement program would have a major negative impact on their credit. That is why I don't recommend a settlement program for someone who can afford to pay their bills. Instead I suggest a DMP discussed above.