Settling Affects The Score

Dave wants to know how much doing a settlement on his credit card debt will affect his credit score.

QUESTION: Dave asks how much a settlement for credit card debt will affect his credit score, as well as when he and his wife later try to get a house.

ANSWER: It will affect your score, but I don’t know how much. It won’t affect it as bad as old credit card debt, which is what you currently have. It does affect your ability to get a home, but the thing about credit is that if you just pay your bills on time from now on, it heals itself over time.