If you happen to be over your head in credit card debt and are losing your mind over it, then that means there is a decent chance you are considering all of your avenues on how to resolve this predicament. You might have spoken with a few different companies or spent a number of hours researching the internet to decide whether to go the route of credit card debt consolidation or debt settlement.

What it truly boils down to is the monetary situation that you are currently experiencing. If you do not have a very large sum of debt and are not having a very difficult time paying it down then credit card debt consolidation could be a more suited fit for you. What the credit card debt consolidation establishment can do is reduce the interest rate on your accounts, and institute a manageable payment program in which the company will spread out the payments to the creditors on your behalf. At the end of the process you will become free of your debts, however the process usually takes around five years and you must pay the whole original balance plus the preset interest rate. Nevertheless, you will become debt free.

Now will credit card debt consolidation workout for every debtor, of course not. Debtors will not really have too much of a decrease in the amount that you must put out each month. So for individuals who are having problems keeping up or have fallen past due, credit card debt settlement may be a more wiser option. The best candidate for debt settlement is a debtor who is around $15,000 in the whole or more and are having legitimate hardship keeping up with the monthly minimum payments. Taking into consideration that with debt settlement you will have a much lower amount you put out each month because you won't be paying back the bill in full.

Basically the dissimilarity boils down to this, with credit card debt consolidation you pay back around 125% of what the balance currently is, which is a far cry away from the amount you would be obligated to pay utilizing the monthly minimum payment scheme. But it's also a big difference from the money you will pay back with settlement. With going through credit card debt consolidation the time you will be in debt is close to five years to you will find yourself out of debt. Debt settlement can look to save between 40-50% of what you owe and be out of debt in 2 years or less, depending on how fast you can raise the cash necessary to achieve the settlement.