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How Will Settling My Credit Card Accounts Impact My Credit Report?
January 22, 2012
I am often asked to help clients negotiate their credit card debts.
I’ve certainly done it before, quite successfully…but there are always some caveats that I warn clients in advance.
One of them relates to the impact of a settled account - on their credit reports.
While your account gets settled and you only pay a fraction of the debt owed to your credit card companies, these credit card companies report these simple (and true) facts to the credit reporting agencies.
Your accounts will have a notation in the credit report indicating that they were “settled,” meaning that you paid less than the amount actually owed.
No, this is not a good thing to have on your credit report…but it’s the lesser of two evils, when the only other option is to have the credit card companies sue you for unpaid funds, and they would end up placing a lien on your bank accounts or garnishing your wages until the entire balance is paid in full.
For more on this subject, you can check out this recent article posted online by Fox Business News.
David Giller, Esq. is a Consumer Law attorney, providing professional, confidential and compassionate legal advice throughout New York City and northern New Jersey in financially stressful matters including bankruptcy, foreclosure defense, debt settlement, Fair Debt Collection Practices Act and Fair Credit Reporting Act. To learn more about David or his law practice, visit www.gillerlaw.com or call 201-478-7412.
I’ve certainly done it before, quite successfully…but there are always some caveats that I warn clients in advance.
One of them relates to the impact of a settled account - on their credit reports.
While your account gets settled and you only pay a fraction of the debt owed to your credit card companies, these credit card companies report these simple (and true) facts to the credit reporting agencies.
Your accounts will have a notation in the credit report indicating that they were “settled,” meaning that you paid less than the amount actually owed.
No, this is not a good thing to have on your credit report…but it’s the lesser of two evils, when the only other option is to have the credit card companies sue you for unpaid funds, and they would end up placing a lien on your bank accounts or garnishing your wages until the entire balance is paid in full.
For more on this subject, you can check out this recent article posted online by Fox Business News.
David Giller, Esq. is a Consumer Law attorney, providing professional, confidential and compassionate legal advice throughout New York City and northern New Jersey in financially stressful matters including bankruptcy, foreclosure defense, debt settlement, Fair Debt Collection Practices Act and Fair Credit Reporting Act. To learn more about David or his law practice, visit www.gillerlaw.com or call 201-478-7412.