People running into debt have meant the rise of a whole new industry of sorts in the world of finance.
This is not necessarily a bad thing as many people have come to benefit, so to say this industry has jumped into the fray in order to just make profits would be grossly unfair.
By using debt settlement services, people are slowly working themselves out of loan trouble thanks to the canny negotiating tactics of personnel from debt settlement companies.
A huge credit card bill can deflate in the wake of negotiations between such companies and creditors.
The companies take advantage of the contacts they have in the industry particularly as many of the negotiators come from banking or credit industry backgrounds.
Earlier, if a person could not pay off his dues, the only option at the time would be to go for a bankruptcy with the attendant stigma attached to it.
Families have broken up when the head of the family has gone bankrupt, they are socially shunned and the future becomes bleak.
This is because it may become very difficult to get a job if your background is checked and if you have any plans to start up a business, you can forget about it.
Credit score is also severely affected and it can literally take years to recover lost ground.
However, on the flip side debt settlement services offer a 'honorable' way out of your financial problems.
True, your credit score will take hit but it would be nothing as would happen in the case of a bankruptcy.
You will be able to pay back your money at a more favorable interest rate and payment periods are often extended after negotiations to give you some more breathing space.
All of a sudden things do not seem so bad any more.
You can hold your head high and say yes, you are making a real effort at paying back your creditors and it will be matter of time before you are back on a firm financial footing.
There is though a need to proceed with caution when it comes to debt settlement services.
Several companies are facing investigation in various states for having swindled their clients by using underhand tactics, such as setting up dummy websites to lure people to avail their services.
However, these are more the exception than the rule and by and large, most firms are honest and genuinely intent on solving your financial problems.