Debt Settlement Enrollment Linked to Greater Credit Score Declines Than Bankruptcy, New TransUnion Research Finds
TransUnion released research indicating that consumers using debt settlement programs often experience larger credit score declines—up to 96 points for current payers—than those filing for bankruptcy. The study identified a 'blind spot' for lenders, as nearly half of debt settlement enrollees were current on obligations upon enrollment, unlike bankruptcy filers who typically show distress.
Key figures
- Bankruptcy score decline
- 20
- Bankruptcy median score pre filing
- 570
- Debt settlement score decline current
- 96
- Truvision capture increase top 10 percent
- 25%
- Debt settlement median score pre enrollment
- 587
AI analysis
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AI-generated analysis of a public disclosure. Not investment advice; verify against the original document.