Credit history is determined by how an individual pays off what he or she owes. The credit background of people is determined according to how they make their payments. If payments are paid late to a company the company will use an outside source/debt collecting agency to write a credit report about the client/clients’. It is important for individuals to learn what is written on their credit report. A poor credit report can prevent people from renting apartments, buying houses, and from getting employment.
People who have major credit card debt are labeled as having a poor credit score. Folks who had a financial decline in credit are recognized as bad risk factors and this is a label in their credit background. They are stigmatized because they were branded through their credit history. Their credit history has hurt them due to unfortunate circumstances that went into a direction way beyond their control. A situation like this can happen to anyone at any given time.
Persons who pay every bill or debt that they had owed on time are labeled as having a high credit score. People who make all of their payments in a timely fashion have a perfect credit score. This means that they have established an excellent credit record rating with financial companies. These are the people who are in a better position to make purchases by getting great sales with no money down due to their perfect credit score.
People whom never owed anyone or made bill payments have not yet established their credit history. Many people are not able to get a line credit because creditors do not recognize them. These are the people who have not established credit history.
Debt settlement is a way to pave an individual’s path to eliminate existing debt by doing a financial recovery. People who make way for financial recovery through debt settlement will be able to boost up their credit scores. Their record of credit will be reviewed and revised and a letter recognizing that the debt was paid off will be sent to them as proof that the debt is at zero dollars.
Conclusion, the purpose of debt settlement is to help people eliminate themselves of debt at a reduced payment agreed upon by the creditor/creditors’ and them the client/clients’ with options by way of financial recovery. When people settle their debt they get better in their credit ratings. How a person makes his or her bill payments defines the history of his or her credit report. People who have major credit problems are branded as having poor credit and are also hurt by their credit record. Individuals who are consistent with paying all of their bills in a timely fashion have higher credit scores. People who have not paid bills or owed creditors did not yet ascertained their credit history. Debt settlement is one step in the right direction, helping people get back on track with their finances; by facilitating them to increase their credit scores and fix their financial history in a report.