DEBT NEGOTIATION WHY WILL CREDITORS SETTLE? If you are unable to make payments for several months, most creditors cannot continue to report the value of your account on their books at full value. Instead they must "charge off" the account to bad debt. This means that they must report the value of the account at a much lower value to reflect the statistical reality that, once an account is substantially delinquent, they usually don't end up collecting very much of it. Furthermore, the cost of collection is high. Paying someone to collect is an additional expense that reduces the true value of the account and, if the account is not collected, is an additional loss that reduces profit. Creditors are in business to make money and they will usually make decisions based on what is most profitable. They would prefer not to spend good money chasing bad. Therefore, thay will settle for less than the full amount it they believe it is most profitable to do so! Creditors are more likely to accept a settlement of less than the full amount