How Does Debt Consolidation Stack Up Versus Debt Settlement? Debt settlements differ slightly from debt consolidation. It is important to build or repair your credit rating, since nowadays you practically need perfect credit in order to get a home, car, personal loan, and so on. If your credit has any record of negligence, most companies will turn you down. If you need help with credit repair, you might want to hire an expert who can get results; otherwise, if you have skills, then it is important that you take care of your credit issues immediately. Putting things off only add up more trouble. On the other hand, getting things done now brings forth results, since the effort you put in will be obvious. Debt settlement solutions work to reduce your monthly installments, as well as reducing the balance you owe. Some debt settlement organizations will work to reduce your bills up to 70% and claim to help you do this in less than two years. The companies will also help you rebuild your credit and avoid bankruptcy. Although few debt settlement agencies and debt consolidation companies will claim to help you get out of debt fast, you must remember that none of us has the potential of being free from debt entirely. We all pay utilities, rent, mortgages, insurance, and so forth, so if you believe that you will be debt free in as little as two years, then you are misleading yourself. The debt settlement and debt consolidation agencies may help relieve you of pending debts, but they will never be able to help you free your life of debt entirely. Finally, the advantage of debt settlement versus debt consolidation is that you will reduce your bills, instead of paying off your regular amount owed. Debt consolidation is merely the act of combining all your bills, rolling them into one, and paying one monthly installment.