Consolidation Service Debt Settlement Versus Debt Consolidation Consolidation services for debt settlement are often a better solution than debt consolidation. These services help you to free your life of stress by ending the harassing phone calls and letters. In some instances, consolidation services have helped people by reducing their bills to less than half the amount owed. The families and individuals were able to avoid bankruptcy courts, and their debts were eliminated in as little as three years. Many of the services for debt consolidation claim the process is simple and free of stress. However, it is frustrating since you must be organized to get the help you need. If you have problems with organizing, then you may feel a sense of stress. On the other hand, the counselors are qualified to negotiate on your behalf, requesting lower payments and lower debts, sometimes even up to 70%. This will provide you with lower monthly installments. Instead of dealing with the creditors individually, the counselor for debt management will handle this for you; this, too, will eliminate stress. The balances you pay toward eliminating your debts are based on your income, and are often determined by 75% living costs. In other words, some companies determine how much money you can afford to pay the creditor after they figure the price of living. However, if you have mortgage payments, then this will reduce the percentage of living costs, since the mortgage is a source of living and a source of debt. Legally, it is against the law for any company to take more than you s make. In other words, any service that offers debt relief or other types of service must factor in your cost of living. Of course, the counselors will help you to cutback on your spending during the settlement process, thus helping you to increase your source of income.