When people are looking for ways to settle their debts, they mostly have two options available.
Basically debt negotiation is when you are negotiating the debt with the creditors with the objective to lower it. The negotiation can be done by you but it is best to be left into the hands of professionals as they will get the most out of it. There are many advantages to debt settling including lower monthly installments, you only need a part of the debt(about 50%) and the interest rate will be lowered.
The aim of the creditors is to get their money back. If you fill for bankruptcy they won't get anything back so it is better for them to negotiate the debt. You can negotiate the debt yourself but if you have bad debt negotiation skills or you wish that you had only pay one party who will then distribute payments to the creditors then it is better to let a professional do it. If you try to the negotiation alone, it won't work as intended because you would have to negotiate with each creditor and this could be difficult. But there are risks to credit counseling to such as the fact that the charge a fee and you won't know how the negotiations turn out until the end.
But mostly the benefits should be about the same and you will get a better debt with a better interest source that will suite your budget and you will be one more step forward towards debt free. It is very important to choose the method that can work for you so you can reduce the actual risk of bankruptcy as bankruptcy puts a permanent dark-spot on your credit history. If you had been bankrupted before, it will take a long time before you can actually take another loan and even than creditors won't trust you and label you as a risky debtor.
Debt settlement is a legitimate alternative to filing bankruptcy. Consumers can expect to eliminate around 50% of their unsecured debt with the help of a legitimate settlement program. With the new FTC laws recently passed in July 2010, debt settlement is a much less risky option. If they don't settle your balance you don't have to pay a dime.
Check out the following link for free help from a certified debt relief specialist: