How Does the Settlement Process Work?

TABLE OF CONTENTS

• 1. Financial Hardship Verification
• 2. Building Funds in Escrow
• 3. Initiating Negotiations
• 4. Securing a Settlement Offer
• 5. Disbursement of Funds
• 6. Repeat Until All Debts Are Settled

The settlement process is at the heart of Debt Consultants Group (DCG)’s debt relief strategy. It’s designed to reduce your overall debt burden by negotiating with your creditors to accept less than the full amount owed—often 40–60% less. Here’s how the process works, step by step:

1. Financial Hardship Verification

Before negotiations begin, you must submit documentation verifying your financial hardship. This is critical. Our Negotiations Team uses this evidence to demonstrate to creditors that your business cannot afford to repay the full balance under current terms.

Examples of hardship documentation may include:

• Cash flow statements showing negative margins

• Past-due notices or creditor demands

• Declining revenue reports

• Legal notices or pending lawsuits

2. Building Funds in Escrow

While negotiations are being prepared, you’ll make scheduled weekly payments into a third-party escrow account. This account is under your name and is used to accumulate settlement funds. Creditors are more likely to negotiate when there’s proof that funds are being set aside for a good-faith resolution.

No settlement payments are made without your approval.

3. Initiating Negotiations

Once enough funds are available and your file has met internal and legal review, our expert Negotiations Team will begin reaching out to creditors. They’ll:

• Validate the debt amount and terms

• Present your hardship case

• Propose a reduced settlement offer

• Negotiate the best possible terms on your behalf

Because of our experience and relationships in the industry, we are often able to reach favorable settlements faster and at lower costs than clients could achieve independently.

4. Securing a Settlement Offer

When a creditor agrees to a settlement, we immediately notify you of the proposed terms. The settlement offer includes:

• Original balance

• Negotiated amount

• Payment deadline or schedule

• Any required documentation

You are in control—no settlement is finalized without your written approval.

5. Disbursement of Funds

Once you approve the offer, funds are released from your escrow account and paid directly to the creditor under the terms of the agreement. A confirmation of payment and release is obtained, providing proof that the debt is considered resolved.

6. Repeat Until All Debts Are Settled

This process is repeated for each enrolled creditor. Over time, your total unsecured debt is reduced through a series of negotiated settlements, each tailored to your financial circumstances and escrow balance.

Through this process, DCG helps your business regain financial control while avoiding bankruptcy or further borrowing. Each successful settlement moves you one step closer to full debt resolution and long-term stability. Your Case Manager will keep you informed throughout every stage of this process.