What is debt settlement law?

Debt settlement law is the legal process that individuals and businesses in the state of Washington use to resolve past-due debts with their creditors. This law is often used as a last resort when other options, such as loan repayment plans, have failed. In this process, a single payment is made to the creditor in order to settle the debt in full, while the creditor agrees to accept less than the full amount that was originally owed. In Washington, debt settlement companies are required to be registered with the Department of Financial Institutions in order to legally represent debtors. Furthermore, any fees charged by these companies must be in accordance with the Washington Consumer Loan Act. Debt settlement law can help individuals and businesses who are struggling with their financial situation. These laws allow debtors to pay off their debts in one lump sum, often at a reduced amount, without having their credit score suffer. Additionally, the settlement process can be completed quickly, often within one month of the agreement. This can help debtors avoid the potential of court-ordered collections, as well as help them keep their credit score intact.

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Is debt settlement reported to credit bureaus?
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What is debt settlement law?

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