What is a deemed satisfaction and how does that apply to debt settlement?

A deemed satisfaction is a legal concept that applies to debt settlement in California. This concept states that a creditor can accept a lesser amount than the full amount of a debt, and consider this lesser amount as full satisfaction of the debt. In other words, when a debtor pays a creditor less than the full amount of a debt, the creditor may agree to consider this amount as the full payment of the debt, and not demand any remaining balance due. This is commonly referred to as a debt settlement or debt discount. When a creditor agrees to a debt settlement, the creditor can officially record a deemed satisfaction in the form of a Satisfaction of Debt document. This document is signed by both the creditor and the debtor, and states that the creditor has agreed to accept the lesser amount of the debt as full satisfaction of the debt. Once the document is filed with the court, the creditor can no longer demand that the debtor pays the remaining balance of the debt. It is important for debtors to understand that a deemed satisfaction does not necessarily make the debt disappear. The debt is still legally due and owing, and the original creditor could still take action against the debtor if he or she is unable to pay the debt. Therefore, it is important for debtors to consider their financial situation carefully before agreeing to a debt settlement.

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What is a deemed satisfaction and how does that apply to debt settlement?

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