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What’s the difference between consolidation debt vs debt settlement?

Don’t worry too much about the definitions since these phrases are used loosly. However, typically debt consolidation is when you combine all your payments into one without reducing the principle amount you owe. You do this with a debt management company or through a mortgage refinance if you have a home that has equity in it.

Debt settlement is where you actually negotiate with your creditors to reduce the principle amount of the debt you owe.