Why would the creditors agree to settle at a lower percentage?
Creditors agree to settle first and foremost because they know if a client files bankruptcy they will get nothing or very little. Creditors also are aware that legal action is costly and not always successful and so can cost them yet more losses. Lastly, if a creditor sells a debt they will likely get less than 10% of the amount owed for it, which is much less than a typical settlement offer. Put simply creditors would rather take sure money now than less, nothing, or even losing money later on.
