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What is the biggest drawback to debt settlement plans as an alternative to bankruptcy?

Good question. In life there are compromises and that is also true with debt settlement plans. While your debt does get reduced, you will go through a period where you credit score will be damaged as a result of the settlement. This is because your debt goes unpaid until the monthly payments that you make into the settlement company trust account accumulate enough to pay off the entire reduced debt amount in 1 lump sum to each creditor you have. For this reason, debt settlement is best for people with really bad financial situations seeking an alternative to bankruptcy.