The reason why debt reduction looks bad is because it takes a few months for your creditors to accept your debt reduction companies payment plan…in the mean time you are not making payment in full according to your creditor. So you will show a few months of late payment and then your credit will improve after the payment plan is accepted and you start to show on time payments again. A bankruptcy shows you have a complete inability to pay your bills…bankruptcy is splashed all over your credit report.

Debt reduction program is not listed on your credit report at all. An experienced lender can tell that that you have been part of a debt reduction program because they can see the pattern in your payments, but there is no flag on your credit report that says this person participated in a debt reduction program.

Anyone who thinks that a lender looks at a bankruptcy the same as a debt reduction program is ridiculous!!! It isn’t even in the same league…bankruptcy is the major league, debt reduction is pee-wee ball.

Debt Reduction Program… but its still pretty bad.

They are both about the same BK will remain on your report for up to 10 years and DRP will remain on your CR for about 7 years. On the long run, if you need to go with BK, life after BK gets better, you could still get credit, but you’ll probably pay high interest rates.

Honestly some lenders view a debt reduction program as bad as a BK as far as what you can qualify for…I have been in the mortgage industry for 4 years and trust me, you should try to find any other option if you can such as a cash out refi if you own a home.

The Debt Reduction Program… declaring bankruptcy is about the worst thing that you can do to your credit history. A bankruptcy will show up in credit reports for years and years.

sue them for giving a fool credit in the first place