Knowing the difference between the various financial services available is what helps you understand which choices are right for your situation. In this case we will discuss the 3 aforementioned debt management programs.
Debt consolidation is one way to help you deal with your monthly obligations, and this sort of assistance is the best way to go in most cases. Consolidating financial obligations mean that you contract a company to help you get all of your high interest rate credit card debt under one low interest rate loan. Your multiple monthly service charges are replaced with one low monthly service charge, and this whole process frees up hundreds of dollars a month that can turn into an extra cash flow for the client that can be used to pay off other money owing problems.
Debt settlement is a bit different in that it still qualifies as a way to try and get your indebtedness under control, but this is a little more intrusive on your credit report and can have a serious negative effect on your scoring. The company negotiates with your creditors to get a lower payoff amount for each of your debts, and then the agent puts together a program for the client with a monthly payment based on the minimum amounts per month that each creditor was willing to take. Since you are asking creditors to take less money than is owed to them to close out a financial obligation, you can see why this has a negative effect on your rating.
Debt validation is not a process you can use to help get your debts under control, but it is something you can use to make sure you are not getting scammed by a collection agency. With this system you are basically asking the collection agency to prove that they are agents asked to collect for the one that they are calling about.
By the way, by researching and comparing the best debt consolidation companies in the market, you will be able to determine the one that meet your specific financial situation, plus the cheaper interest rates offered. Nonetheless, it is advisable going with a trusted and reputable debt counselor before making any decision, this way you will save time through specialized advise coming from a seasoned debt advisor and money by getting better results in a shorter span of time.