Categories: Curiosities

10 Ways You Think You’re Helping Your Credit But Are Actually Hurting It

Settling your debt for less

Debt settlement involves negotiating with your creditors to pay less than the balance due to satisfy your debt. For example, you may owe $10,000 but negotiate a debt settlement which allows you to pay just $5,000 to satisfy your debts.

While lightening your debt load may seem like a prudent thing to do, using a debt settlement to do it can have a negative impact. That’s because credit scoring is designed to reward those who pay all debt in full per the original terms of the credit agreement. Other lenders may take notice and be cautious of extending you credit in the future.

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C.C.

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