Once a debt is sold to a collection agency you have a chance to settle the debt for a lesser amount, often pennies on the dollar.
While getting out of debt sounds great, consumers using debt settlement companies often fail to realize the dangers. You may be able to reduce your debt but the negative impact on your credit scores may not be worth it.
Debt settlement can hurt credit scores because having late payments are essential to settlement, creditors are motivated to settle when you have multiple lates
Using a debt elimination firm could cause you to end up with a bad credit score, tax lien, foreclosure, or a debt collector at your heels.
Some have criticized the CFPB as an unnecessary bureaucracy but they cannot argue the fact that consumers have benefited from settlements negotiated by the CFPB