Debt settlement companies claimed 85–100% success rates to undercover government investigators. Federal and state agencies documented actual rates often in the single digits. Here is what the research shows before you enroll.
Quick Answer: Colorado’s debt settlement fee structure changed when the state repealed its 18% fee cap in 2011, and now recommends limiting settlement fees to 15% of the actual debt forgiven. This change aims to protect consumers who often end up in worse financial situations despite debt settlement being marketed as a bankruptcy alternative.A reader …
Part of the Credit Counseling Hub: This post is one piece of my complete Credit Counseling: The Complete Guide — what a DMP costs, who it helps, the agency financial stability risk, and how to verify any agency before enrolling.Quick Answer: The debt solution industry, including credit counseling organizations like NFCC and CCCS, lacks transparency …
Quick Answer: According to Illinois Attorney General Lisa Madigan, 65% of people enrolled in debt settlement programs quit before any creditor communication occurs and receive no refunds. These companies collect upfront fees for months while instructing clients to stop paying creditors, resulting in increased debt through late fees and higher interest rates.An interesting article out …
Quick Answer: Most debt settlement companies are not legitimate, with Minnesota Attorney General Lisa Madigan stating consumers “would be more likely to settle debt by buying a lottery ticket” than succeeding with these services. CBS’s “Early Show” investigation revealed strong warnings about the industry’s poor success rates.A report on the CBS “Early Show” had some …
Quick Answer: Debt relief companies have a success rate under 10%, according to a Colorado Attorney General report covering 2006-2008. Fewer than 10% of consumers completed their agreements with 42 debt settlement and credit counseling companies by paying off or settling all debts.I previously wrote an article The Truth About The Failure Rates and Completion …
Did this conversation help?
Thank you. I'm glad you reached out.
You took an important step today. Come back any time.
Think of this as me — just in AI form. I've walked in your shoes. I filed bankruptcy myself in 1990, and in over 30 years of experience I haven't seen a situation that can't be worked through or a person who deserves judgment. Everything here is built on that experience, that research, and genuine care for you. I can't be there in person. But I can be here.
Conversations are saved anonymously. Personal details are automatically removed before storage. This is an AI — not a financial advisor, attorney, or therapist.
Not sure where to start?
Been here before?
