What happens when you do debt relief?
Debt relief could involve wiping the debt out altogether in bankruptcy; getting changes in your interest rate or payment schedule to lower your payments; or persuading creditors to agree to accept less than the full amount owed.
How do you qualify for debt relief?
To qualify for National Debt Relief's debt settlement program, consumers must have at least $7,500 in unsecured debt for a qualified debt type. Qualified types of debt include major credit cards, department store cards, personal loans, medical bills, credit unions, some secured debts and some private student loans.
What is the downside to debt relief?
Stopping payment on a debt means you could face late fees and accruing interest. Additionally, just because a creditor agrees to lower the amount you owe doesn't mean you're free and clear on that particular debt. Forgiven debt could be considered taxable income on your federal taxes.
Does debt forgiveness hurt your credit?
Your credit score isn't impacted\n\n When your debt is forgiven, your credit score is generally not affected. Having less debt can also improve your credit utilization which helps boost your credit score.