Unfair and Deceptive Acts and Practices: 6.14.4 Debt Settlement and Debt Negotiation
In contrast to credit counseling agencies, most debt settlement and debt negotiation companies claim to help consumers settle debts for less than the full amount owed. They usually encourage the consumer to stop paying their creditors and to send the money to the company instead. The company tells the consumer that it will hold the payments until enough has accumulated to offer a lump-sum settlement to the creditor. The company typically charges various fees that make saving difficult.