A Debt Settlement Company Paid a Creditor and They Now Say the Debt is Still Owed. – Ken

“Dear Steve,

have contract with debt settlement firm i have asked you things before was very pleased with your detailed answers

have you ever heard of a debt settlement firm paying a creditor acct. for a client and now they show i owe them


Dear Ken,

I have seen the situation before. This can arise from one of two primary ways.

  1. The settlement deal was reached with an outside collection agent of the creditor who they will say did not have the authority to agree to such a deal.
  2. The settlement deal was not obtained in writing saying that the balance of the debt would be discharged.

I’d suggest you get your hands on the agreement the debt settlement company got from the creditor and produce a copy of that to the creditor in question.

Most of these issues are purely administrative and can be resolved with a copy of the settlement agreement.

Your debt settlement company should gladly help you to clear up this issue. If not, let me know.

Please post your responses and follow-up messages to me on this in the comments section below.


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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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3 thoughts on “A Debt Settlement Company Paid a Creditor and They Now Say the Debt is Still Owed. – Ken”

  1. Dteve,  I have a credit card debt that I cannot pay as a result of my lifepartner becoming a quadraplegic and I haceom her caregiver full time.  I am paid 1350./mo from the state anhat is my only income.  I asked them if they could help and they say thaey can’t, so I stopped making payments 2 months ago.  When they call I ask them if they can provide lowere interest to lowere the payment, but they say no.  What can I do at this point?


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