Debt settlement is a serious matter. This debt relief option allows you to negotiate with your creditors to pay off a portion of what you initially owe them. It indeed provides instant relief from overwhelming debt, but it can also create a negative impact on your credit score.
Settlement may give you a negative impact on your credit score but you can definitely bounce back from it. It will need some effort and definitely a lot of patience but it can be done.
When you settle a debt, the word “settled” will be reflected on your credit report. Once this appears, it will lower your credit score. But the good news is that it is not as damaging as compared to you defaulting on the debt entirely. The negative impact will last for a few years but it is not permanent.
There are several steps you can take to start recovering from the settlement.
It would also help if you can stop getting into new debts while recovering from your debt settlement. Continue paying on time, and be responsible in monitoring your credit report and you will recover from your debt settlement in no time.
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