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Thinking of what will happen if I do reduction or settlement

Date: Sat, 08/27/2005 - 17:25

Submitted by anonymous
on Sat, 08/27/2005 - 17:25

Posts: 202330 Credits: [Donate]

Total Replies: 3


The deal offered to us is a "likely" reduction/settlement of 40% of our cc debt, plus 15% commission, with the agreed upon payments clearing the debt in 36 months. The part that is awful to me is that our payments would go into a trust account, & only when they build up enough to negotiate settlement terms will the cc companies be paid. I am NOT behind, just struggling to meet minimum payments & getting nowhere near paying them down. My accounts going unpaid for months terrifies me. I am thinking that my credit would NEVER recover from that. Is this common practice? Has anyone done this & gone on to buy a home etc in later years? How can you let a bill go unpaid for months?!!


Your credit would recover, it would just take a long time in order to do so. Everyone's situation is different. I dont think anyone has intentions of "letting" things go, things happen you get behind and its like a domino effect. I would say if you can prevent your accounts going unpaid for months, by all means do so. Because it can come back to haunt you when you are ready to purchase a house. It will effect your interest rate as well as the amount that you are approved for and your down payment.


lrhall41

Submitted by Rhonda28 on Sat, 08/27/2005 - 23:57

( Posts: 411 | Credits: )


If you're not behind now, I wouldn't do it. I started messing with those companies 4 years ago and I'm dealing with a low 500 credit score. Not fun trying to get a mortgage or any loan.


lrhall41

Submitted by on Mon, 08/29/2005 - 06:05

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If you are having a good credit and you are considering debt settlement, this wont be a wise decision to make because it will destroy the credit ratings on two fronts.

Firstly, your account has to be 90-120 days past due so that you can qualify for a debt settlement9 program. This will kill your payment history and will lower your score further down. ???Settled??? is a considered to be a negative remark and will stick in your credit report for the next 7 years. It will go in your credit report as "R-9" which is a half-step above bankruptcy.

The debt consolidation company needs to assure you that they will take every possible measure to enhance your credit file.


lrhall41

Submitted by ben on Mon, 08/29/2005 - 10:23

( Posts: 2034 | Credits: )