How is credit affected by settling an account for less than what is owed?

For example: I have a credit card that had an original credit limit of $500...I HAD it paid down to $300...stopped making payments, bill is now over $900, creditor offered a settlement of $488. How will accepting the offer affect my credit?

How about in general, how do settlements on loans and credit cards affect credit report/scrore?

What if the bill is current and you make a settlement? Does that show up negatively on your report?

How is credit affected by settling an account for less than what is owed?credit card offers

It improve your credit if you agree to the creditor negotiation but will not be remove after 7 years.

Your existing past dues account is already hurting your credit.

I say about -25 to -75 per month on your credit score for keeping a existing past dues account.

How is credit affected by settling an account for less than what is owed?

loan

It is in your best interest to take the settlement.

This card has been sent to collections and this is the creditor%26#039;s best effort attempts to acquire what they can. They%26#039;re doing this for themselves as they wish to stay a profitable company. Alas, it works towards your favor too!

By taking the settlement it can do nothing but help you as your creditor will report you to the credit agencies as you did pay off the credit card and there won%26#039;t be official record on your credit that any settlement was ever made except show that the account was changed to paid/resolved which is incredibly better than permanent delinquency/ charge-off in the eyes of creditors. It shows you are making your best efforts and are in good faith. This works in your favor!

By taking a delinquency out of default it can increase your FICO score and help you begin to repair the damage much more easily and in a shorter amount of time.

Best advice, take the settlement! If you can%26#039;t afford the amount right away, a lot of times they will work out a payment plan. Otherwise, find a way! You%26#039;re *VERY* lucky they%26#039;re willing to settle with you and forgive all the extra penalties from late/delinquent payments.