One of the most important tasks in managing debt is ensuring that they are all consolidated together. Debt Settlement can happen only when all the debt is consolidated and one can re-negotiate on the consolidated debt structure so that the same can be settled.

The principle is simple. One might have incurred little amounts of debt across say ten different debtors. Since the debt amount is small, the interest to be paid would typically be higher. However, if a firm such as Credit Exchange steps in and consolidates all that debt, then there will be a large amount on which renegotiation can happen on the interest rates.

If the interest rates are re-negotiated, then it helps the individual since the debt settlement has to happen over a reduced interest rate and hence a reduced payout level.