Debt settlement is good alternative to bankruptcy for many consumers struggling with high credit card debt. In most cases, consumers will hire a professional debt settlement company to work with their creditors to pay off their debt at a reduced amount. Fees often range from 15-25% of the amount saved.

But do you need to pay a company to settle your debts?

For most people, it is a good idea to hire a professional company. There are several reasons:

1 – The creditors usually take a professional more seriously

2 – These companies often have relationships with the creditors and will be able to get you a better deal

3 – While the process is not difficult, it does take time, effort, and patience.

However, if you are ready to take on this task by yourself, here are a couple of tips to help you through the process:

• Realize that settling a debt is like negotiating anything – you need to give something in order to get something.

• Just because you feel that you are offering a good deal, does not mean the person you are negotiating with thinks the same way. So, you may have to make several offers before one is accepted.

• Many people think that protecting their credit score is a key point – but the goal of debt settlement should be getting out of debt (why would the creditor give you a discount AND good credit? You can certainly try, but don't be surprised if this part of the offer is not accepted).

• In most cases you will need to pay in one lump sum, not payments (see the first point above). So you will need to have some money in reserve.

• If you are not already behind on your payments, you will need to stop paying to gain leverage. After all, why would the creditors give you a discount if you are paying on time? Take this money and set it aside for your settlement payment.

• Finally, be patient. Negotiations can take time. But the longer you can hold out, the better deal you will get.

If this does not sound like something you can accomplish on your own, then you should seriously consider hiring a professional debt settlement company.

Otherwise, get ready to roll up your sleeves, make a few phone calls (letters are not as effective), begin negotiating.

And start making plans for using the money you save wisely, and avoid getting into credit card debt all over again!