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Is debt settlement really helpful if I’m delinquent on credit card payments?

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For past few months I’m experiencing financial hardship. I have already been delinquent on some of my credit card payments. I’ve come to know about debt settlement. Is it really helpful?

Debt settlement is good if you’re not current on your loan and payments. You can try to settle debts with your creditor if you’re unable to pay the entire outstanding balance. By settling your debt(s), you get rid of your debts paying a percentage on your outstanding debt amount.

Sub: #1 posted on Mon, 06/13/2016 - 22:08

phoenix phoenix
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Hi Carloss,
When you opt for debt settlement, you should know that you'd have to pay a tax on the forgiven debt amount, as the IRS considers any forgiven/canceled debt as the debtor's income. The creditor will file a 1099-C form with the IRS and will send you, the debtor, a notice, as well.

Sub: #2 posted on Thu, 06/16/2016 - 04:28

Good Nelly Good Nelly
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Also, if the debt is still with the original lender and has not been written off as a bad debt, it may be more helpful to your credit score to workout a repayment plan. Settlements can negatively effect your credit score for years.

Sub: #3 posted on Thu, 06/16/2016 - 06:16

Mr.D.E.B.T. Mr.D.E.B.T.

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