Sometimes, people do not care about their increasing expenses and their extra luxuries which at times cause them to use their credit cards in their daily life extensively or take some loan to keep avail luxuries. This is called abnormal use of credit cards in normal language. People come to know about their excessive when the time to return their loan or paying installment of credit card comes. Then these people slowly get buried under burden of unsecured loans and to get rid of these unsecured loans they prefer to file for bankruptcy without knowing its bad effects. Now suitable changes have been made in laws which facilitate customers to get rid of their loans. Debt consolidation and debt settlement services are the most commonly used methods which help customer to get rid of their unsecured loans. This article will guide you about Debt Consolidation vs. Debt Settlement.Debt consolidation is a method in which some low interest loan is taken to pay back other small loans. In other words, one unsecured loan is taken to return other unsecured loans but this is a larger amount loan in which some property or asset is mortgaged, most commonly a house or car. In this type of loan, risk of lender is reduced so he agrees to provide loan on lower interest rates and in case the customer is not able to pay back his loan then the lender is allowed to sale that mortgaged asset. Sometimes, this loan is also taken to get rid of the tension of dues of multiple credit cards.Debt settlement is a process in which a customer hires some debt settlement lawyer to negotiate with creditors on behalf of the debtors and try to make some settlement between both parties and convince them on some middle amount which is acceptable to both debtor and creditor. In this process, mostly 25 to 50% amount is waved off rather than paying back full amount and rest of amount is paid in affordable monthly installments. The Advantage of debt settlement over debt consolidation is that the customer is facilitated to pay back a little amount than the actual complete amount and he gets safe from long term loans.