Financial Information
is using a credit card consolidating company to pay off debt bad for the credit score ?
Question : is using a credit card consolidating company to pay off debt bad for the credit score ?
how long will this afect the credit score when using a credit card company to pay credit card debt
pay credit card debt
Best answer:
Answer by Tango
Yes, but if your credit is already messed up it really doesn’t matter. You have to be very careful in choosing the right one. What happens is the company mediates on your behalf to settle the amount of the debt. Then while your making payments to the company they are holding your money until the amount of the debt is collected and then they pay the debt. While this is going on the debt continues to be reported as unpaid not looking good on your credit. They will give you an amount to pay monthly and a time frame in which all your debt should be paid off. There are several different types of companies out there so do your research and just make sure they tell you exactly how it all works. I would suggest contacting several different places before choosing. Talk to your friends/co-workers you trust. There are more people in the same situation than you think.
-
-
#3 written by CatDad 1 year ago
Stay away from any “debt consolidation” company that promises to cut your debt in half through debt settlement….This is a risky tactic of deliberately ceasing all payments to creditors and forcing your accounts into default to attempt settlements. You pay a monthly fee to a debt consolidator….this entire fee goes towards building a settlement account and to the consolidator’s fees to “settle” your accounts in the future. Your credit card companies will deliberately not be paid so that all the accounts will default/charge-off so that they can attempt settlements at around 50%. If you are current on your accounts, this process will ruin your credit rating for sure. Debt settlement is like a roll off the dice with your finances…You can never predict how your creditors will respond to the deliberate defaulting of your accounts…they might settle at 50%…or they might serve you a summons, take you to court…and if they win, you could be looking at wage garnishment.
None of these “debt consolidation” firms have the power to force your creditors to accept settlements. Your creditors have the right to refuse these terms and take you to court.
http://online.wsj.com/article/SB122394458494631223.html
http://podcast.mktw.net/wsj/audio/20081013/pod-wsjlaise/pod-wsjlaise.mp3 -
#5 written by amm3978 1 year ago
if your doing it through a credit card company, you will be in worse trouble because of the continuing interest rate. You will never get ahead if you do it through a credit card company. I would suggest that you go somewhere where they make arrangements to stop the interest from accumulating, then you will somewhat get ahead
- Comment Feed for this Post
Сredit repair workеd fine to fix my credit. They disputed and removed lots of bad items from my credit report. I used this service – freecreditreport.sinfree.net