With default rates in the double digits, some credit card companies will allow you to pay off your debt at a discounted rate. But is it better for your credit to pay a fraction of the debt? Carmen Wong Ulrich explains the best way to help your credit recover quickly.

If you have a financial question you'd like Carmen to tackle, post it here in the comments or email us directly at ivcommunity@mail.ivillage.com

Watch Carmen Wong Ulrich's 'On The Money' Saturdays at 8PM ET on CNBC! Find more information on coping with the economy with our Bail Yourself Out resources.