This week, personal finance reporter Sandra Block with USA Today wrote an article on the pros and cons of debt relief, citing the good and bad things about debt settlement, credit counseling and bankruptcy. Here’s an excerpt from the article:

Debt settlement. Debt-settlement companies negotiate with creditors to reduce the amount of debt you owe. You’re typically directed to make monthly payments into a savings account. When a certain amount has been saved, the company will go to your creditors and offer to pay off a percentage of your debt. Debt-settlement companies say they often succeed in reducing their customers’ debts by 50% or more.

Pros: Debt settlement is an alternative to bankruptcy for people who are struggling with large debts from financial setbacks, such as a serious illness or divorce, says Don Goldberg, a spokesman for the Consumer Credit Rights Campaign, a coalition of debt-settlement companies. It allows them to reduce their debts without losing their cars and their homes, he says.

Cons: Some debt-settlement companies charge large, upfront fees that reduce the amount of money available to negotiate with creditors. If you stop paying your bills — which some debt-settlement companies tell their customers to do — interest and penalties will increase the amount you owe. Your creditors could take you to court, and your wages could be garnished. Even if you’re successful, your credit score will take a serious hit.

Where to learn more: Don’t respond to advertisements promising fast relief from your debts. These are often placed by marketers that receive a commission for referring customers to debt-settlement companies. Instead, check out companies that belong to the Association of Settlement Companies or the United States Organizations for Bankruptcy Alternatives. Both are trade groups that require members to adhere to certain standards. Ask for a free consultation, and make sure you understand how much of your payments will go toward fees.

For a complete look at the pros and cons of debt relief options, you can read the full article here.