Debt settlement – How will the creditors get paid?

I have knee-deep in debt. I won\'t be eligible for bankruptcy. I know that. This is why I have decided to pay back my creditors through debt settlement. But I have no idea about how will my creditors get paid. The creditors can’t sue me once I have enrolled into the settlement program, right? Will it have any effect on my credit?

3 Answers

Well Fiona, you just have to check your credit report time to time so as to get the information whether the payments are reaching your creditors. When you make the single monthly payments to the company, they're supposed to store the money in a trusted account and later on repay your creditors. So, check this by pulling out your credit report.

Thanks Soaplady. I am getting help from a debt settlement company. How will I know that my creditors are receiving the payments? 

Are you planning on going thru a debt settlement company or are you going to do the settlements yourself??  In my opinion, it is always better to handle your settlements yourself instead of paying gobs of cash to company to do it for you.  It is not rocket science ...just do your research.

Debt settlement WILL tank your score as you are not paying as agreed.

It is always possible to be sued once your account is past due.


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