The Truth About Debt Settlement
A 4-Part Educational Series
by Jared Strauss
Learn how debt settlement actually works, why long-term settlement often does not finish, and how to protect yourself.
Most People Make Decisions About Debt Settlement With Incomplete Information
This free 4-part series gives you the full picture — including what most debt settlement companies won’t tell you.
What You’ll Learn in This Series
How Debt Settlement Works
Understand the two main approaches to debt settlement and why speed changes the risk.
How Debt Collection Works
Learn exactly what happens to your accounts as they age through the collection cycle — and when the risk of being sued increases and what you can do about it.
Debt Settlement Pros and Cons
Discover the hidden risks of long-term debt settlement programs and the risks of leaving accounts unpaid.
A Better Way to Get Out of Debt
See exactly how our Simultaneous Debt Settlement approach works and why our Payment Plan service may be the better fit if you need time to rebuild.
Why You Should Read the Series in Order
Each part builds on the previous one. Starting from the beginning will give you the clearest understanding of how debt settlement really works and whether it’s the right option for you.
Common Questions
Why does long-term settlement often not finish?
Long-term programs are built to run 24–48 months. Accounts generally stay unpaid while you save, and unpaid accounts are the ones that can reach an attorney. Settling them one by one can also make the remaining creditors less willing to negotiate, because they see you as more collectable once other accounts have been resolved. The fee is usually based on the enrolled balance, rather than savings, so money that could have gone toward settlements is used for expensive fees instead. A 2020 study commissioned by the debt-settlement industry found that 22% of enrolled consumers settled all of their accounts within 48 months. Many people do not finish. Those who stop partway through have spent time and money with little progress toward credit recovery, and the remaining accounts are often harder and more expensive to resolve.
How fast can debts be negotiated?
If you can fund the accounts together, they can be settled in months rather than years. The Strauss Method typically takes about 6 months. Some finish sooner. Some take longer.
Does settling restart the 7-year credit-reporting clock?
No. Paying or settling a collection or charge-off does not restart the 7-year reporting period. The FTC said so in its advisory opinion to Amason. A payment can restart the statute of limitations, which is the time a creditor has to sue. Those are different clocks.
Takes about 15–20 minutes to read the full series