If you are receiving unsolicited phone calls from an entity pretending to be ACCC (a trusted non-profit credit counseling agency), please be assured that ACCC’s policy is NEVER to contact you unless you’ve explicitly requested us to call you. Also be cautious of emails from an unusual or unfamiliar domain. ACCC’s domain extension is @consumercredit.com, and any emails using a different extension should be treated with suspicion.

×

ACCC’s Client Login allows current clients to access their program information, including the due date, program benefits, and other documents.

Select a Client Login below based on the service that you are currently enrolled in:

Debt Management Program

Client Login

Bankruptcy

Pre-Bankruptcy Client

Post-Bankruptcy Client

Not yet a client, but looking to get started?

ACCC offers debt relief options to individuals and families that are suffering from stress related to credit card debt by providing effective credit counseling, helping to consolidate debt, and advising on debt management.

Get Started

Wait!

You are now leaving the Consumer Credit website and are going to a website that is not operated by ACCC. We are not responsible for the content or availability of linked sites.

Are you sure you want to leave?

No, return me to the previous page.

Yes

How Bad Does Debt Settlement Hurt Credit?

Navigating the world of debt can be daunting, especially when considering solutions like debt settlement. But the pertinent question remains: How significantly does debt settlement affect credit scores?

The Impact of Debt Settlement on Credit Scores:

Engaging in debt settlement, often referred to as debt collection settlement, involves collaborating with settlement firms to negotiate a reduced payment with your creditors. Although some advertisements might claim colossal savings, typical settlements hover between 25% to 80% of the original amount. It is always good to weigh in the pros and cons of debt settlement before you jump into the process.

To facilitate debt settlement, you’ll halt payments to your creditors. As your accounts amass overdue amounts over several months, the debt settlement agency steps in, offering your creditors a reduced sum. Creditors might accept this if they perceive it as their best return, favoring a partial repayment over none.

Accepted Settlement Offer Consequences:

Upon an accepted offer, your debt gets cleared. However, the ramifications for your credit score are negative due to months of unpaid bills and settling for less than the full amount.

Rejected Settlement Offer Consequences:

A declined offer still harms your credit score, stemming from continued non-payment. Recovering your credit to apply for credit cards, loans, or housing might span up to seven years.

Credit Card Debt Settlement:

The detrimental effects of debt settlement apply uniformly, whether it’s credit card debt or other personal loans.

Comparing Debt Settlement with Bankruptcy:

Bankruptcy usually exerts a more substantial toll on credit than debt settlement, requiring up to a decade for credit repair.

Debt Settlement vs. Debt Consolidation:

Debt consolidation, which groups multiple debts into one, tends to be less damaging to credit scores as it doesn’t involve payment default.

Debt Settlement & Debt Management – A Contrast:

Opting for a debt management plan usually spares significant credit score damage since monthly payments continue throughout the debt resolution process.

Unraveling the Best Debt Solution with ACCC:

To thoroughly grasp the advantages of debt management compared to debt settlement or bankruptcy, get in touch with American Consumer Credit Counseling for a complimentary credit counseling session. Our accredited credit counselors will illuminate all debt resolution options, outlining the potential effects on your credit score.

See if our Debt Management Program is right for you Should you consolidate your debt? See how much it really costs to use your credit cards
creditU

Your Ultimate Money Management App

Meet CreditU, the ultimate one-stop debt and financial management app! See your full financial overview, including debts, income, expenses, and savings.

CreditU Apple App Store
Dev Tool:

Request: how-bad-does-debt-settlement-hurt-credit
Matched Rewrite Rule: ([^/]+)(?:/([0-9]+))?/?$
Matched Rewrite Query: name=how-bad-does-debt-settlement-hurt-credit&page=
Loaded Template: single-resource-pages.php