Our office often works with creditors to try and negotiate a lower settlement on claims and has reached great success. Our office oftentimes has a greater success in non-bankruptcy workouts because the threat of bankruptcy is always on the creditors mind when we negotiate.
Creditors know that our office has filed thousands of bankruptcies and that if they do not settle then there is a good chance that they will get nothing (or much less than we have offered).
In order to have a successful non-bankruptcy workout, we like to see a limited number of creditors (as any single non-cooperative creditor may ruin the whole deal for everyone) and a source of funds (such as borrowing from a friend or taking a hardship loan from retirement).
We recently had a client settle on four claims for less than $17,000 when he owed over $70,000. He did not want to file and was able to borrow from a retirement account. Our fees for saving him $50,000 was less than $2,000.