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A debt collector has been brought in and offered to let me settle for a reduced amount: Does that mean the debt is cleared and how will that affect my credit rating?
A debt collector has been brought in and offered to let me settle for a reduced amount: Does that mean the debt is cleared and how will that affect my credit rating?
If you are happy to settle with the debt collector then the debt collector will be acting on behalf of the lender or on his own behalf in which case he will be the owner of the debt. Clearing the debt with the collector will annul the debt but it will not mean the fact that it has not been paid in full will not be recorded on your credit record. The default will still be noted - it just means he or the original creditor will have accepted a reduced settlement and agreed not to pursue you fuirther.
You are no longer in default and paying off a debt regularly and in time your payments will be recorded and your credit rating will improve.
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