One of the benefits about debt negotiation is that it will not show up on your credit report like a bankruptcy. Debt settlement is not an action that is monitored by the credit bureaus. Debt Settlement is not something that is filed in court, it is just plain and simple negotiation. If anything it only helps your credit score. When you take an unpaid collection on your credit report and settle with your creditor, you then have a paid collection on your credit. A paid collection on your credit is viewed as a positive by the credit bureaus and will have a positive effect on your credit score. Do not expect that your credit score will just jump right back up to where it was before the unpaid collection appeared on your report. It does take time. The more time that passes from the event the better your credit score will be. This assumes that you still keep paying your bills on time.
Worrying a about your credit and potential taxes when considering a debt settlement program should be low on your priority list. Your main focus should be to get the debt paid off as fast as possible so you do not have to worry about your bills anymore. Can you see it now – living life debt free?
Debt Free Dave has been in the Mortgage and Consumer Finance industry for nearly 18 years. He has a degree in Finance and Real Estate from the University of Arizona. This Article is designed to be of general interest and should not be considered legal advice. The specific information discussed may not apply to you. Before acting on any matter contained herein, you should consult with your personal legal adviser.
