Well, for the most part, no.

The U.S. Government Accountability Office recently announced that an extensive investigation found rampant fraud, abuse and misrepresentation in the debt settlement industry.

The following is a quote from a GAO report to a Senate committee about what the investigation discovered....

While we determined that some companies gave consumers sound advice, most of those we contacted provided information that was deceptive, abusive, or, in some cases, fraudulent. Representatives of several companies claimed that their programs had unusually high success rates, made guarantees about the extent to which they could reduce our debts, or offered other information that we found to be fraudulent, deceptive, or otherwise questionable.

It turns out that many of these debt settlement companies charge very large up front fees which customers are not able to get back later if they are not pleased with the results.  Some of them even claim to be government-approved or part of the economic stimulus program.

The GAO says that fewer than 10% of the people who hire these debt settlement companies actually settle their debt for "pennies on the dollar".

So if you do hire one of these companies you might want to keep your expectations in check.

The reality is that most people who sign up with these companies fall further behind on their debts, they see their credit ratings go down the tubes, and they often end up having collection agencies coming after them.

The bottom line is that if you want to get out of debt you should not rely on a debt settlement company.  In addition to being out the huge fees that you pay to such a company, you will probably just ruin your credit and end up much farther behind on your bills.

The truth is that you would be much better off trying to reduce your expenses, working with your creditors to construct a reasonable payment schedule and figuring out a way to start bringing in more income.

So what do you think?  Do you think debt settlement companies are the way to go?  Have you had a positive or a negative experience with a debt settlement company?  We would love to hear your story - please feel free to leave a comment below....