Answer: I encourage you to consider all of your options. Before you consider debt settlement, however, you should understand that a Chapter 7 bankruptcy may allow you to discharge all of your credit card debts, medical bills and many other types of consumer debts. Given the fact that a debt settlement may still harm your credit, going the route that will result in the greatest savings may be your best bet. I have had several clients come to me to complain about the debt settlement process, including large tax debts resulting from debt settlements.