Credit card debt settlement is a process or program in which both the creditor and the debtor agree on a specific reduced balance to act as a payment in full. Debt settlement is also referred to as debt negotiation and debt arbitration. You can negotiate credit card debt settlement by yourself. You can also turn to a lawyer, or seek out a debt negotiation or credit card settlement company. The process will remain the same. You will negotiate with your creditors to reduce the entire amount of credit card debt. For credit card debt settlement to be successful, you will require a lump sum of cash to pay off the entire debt. Alternatively, you could have build-up funds. A credit card settlement is not recommended by the Consumer Federation of America (CFA). A credit card settlement does have a negative effect on your credit. It is taxable. If you are heading toward bankruptcy, credit card settlement may be the solution. Otherwise, credit card debt solution is a very expensive way to solve your credit card debt problem.