What is a settlement offer?

A settlement offer is a proposal made by a creditor to a debtor to come to an agreement about payments on a debt. In South Carolina, a settlement offer must be made in Consumer Debt Defense Law in order to protect the rights of the debtor. This offer is usually a lump sum or a structured payment plan, and it is made in order to avoid the cost of filing a lawsuit and the risk of a court judgment. This offer may be accepted or rejected by the debtor, and if accepted, the offer will become binding and cannot be changed or revoked under South Carolina law. The terms of the offer will be documented in a formal agreement, and both parties will need to sign the agreement in order to make the offer legally binding. Once both parties have signed the agreement, the creditor will usually make one payment to the debtor, whom will in turn make payments to the creditor over a period of time, usually at lower interest rates than would have been charged by the original loan.

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