Debt settlement is the process of hiring a debt consultant to negotiate with your creditors to lower your payoff amounts for your credit accounts.
The associate will work very hard to make sure that you are able to secure much lower payoff amounts for your credit accounts, and then you will be put on a payment plan to start paying off the agreed to amounts.
In many cases it is not a loan you are paying, but rather a program you are paying into where everyone involved expects payment in full and on time.
In most cases going through the process of debt settlement can have serious negative repercussions on your credit score, and it could take years to come out from under the shadow of a settlement.
Debt consolidation is the process of taking all of your high interest rate credit card debt and paying them off with one low interest rate loan.
You are reducing your monthly obligations severely by eliminating all of the service charges associated with your multiple accounts, and bringing them under one loan with one service account.
You will knock hundreds off of your monthly obligations and you will open up extra cash flow.
Debt assistance such as this can also help improve your credit score as all you are doing is paying off the accounts in full with no request for a lower payoff amount.
Your accounts are marked as paid in full, and the history on those accounts is stopped before any more damage can be done.
If you can do debt consolidation then it is advisable to do that over settlement.