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No. of Recommendations: 1
AJ's analysis is correct and very good. My only additional comment is that the "debt relief" has more issues than listed.

'Debt relief' typically does as Dave suggests, and holds client payments (often not in trust funds) to force creditors to write off debt, and then 'negotiates' settlements, all the while, charging outrageous fees.

Plus the possibility of taxes on the "forgiven" debt which is the inflated value after all of the fees for non-payment.

The percentage they claim to have forgiven is often based on the final value and not the initial value before stopping payments.

This can create a life long problem where the debts can resurface from questional credit collection companies. The old debt can resurface if you acquire a credit account from the same company at a later date.
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