BANKRUPTCY VS. DEBT SETTLEMENT
Most debt settlement/consolidation/negotiation companies are scams, ruin your credit and generally do not work. Not every company is running a scam but the good ones are very rare. I honestly know of none. Most charge significantly more than a bankruptcy and end up doing nothing. Before hiring any debt settlement company, check them out with the BBB or run them through a Google search first.
Most individuals can wipe out more debt quickier, for less money and rebuild their credit faster through the Chapter 7 bankruptcy process. For those wanting or required to file a Chapter 13, most can pay their way out of debt for less money through the Chapter 13 process. No debt settlement company will ever guarentee what you'll end up paying before you're out of debt. That's because it's up to your creditors and out of their control. In a Chapter 13, the court determines what you'll pay, it is out of your creditor's control. If you pay as required in a Chapter 13, you know what your result will be. With a debt negotiation company, you'll never know exactly what the result will be, how long it's going to take or even if the company be in business next year.
I've had many clients who wasted thousands of dollars on debt settlement just to be sued and harassed until they gave up and called me. Unlike bankruptcy attorneys, debt settlement companies are virtually unregulated. Bankruptcy is much more certain and there is no "scam" involved. Attorneys are heavily regulated by the courts and other administrative bodies to protect you.