Although "technically" the terms debt settlement and debt negotiation have different meanings, they are often used interchangeably to describe the same thing.
In other words they are both commonly used to describe the process whereby a consumer (or business for that matter) negotiates with a creditor to settle a debt for less than the principal amount owed. As you can see from the definition itself, there are typically two stages in the process, the "negotiation" stage, and the "settlement" stage.
The negotiation stage involves the back and forth discussions and offers that occur over a period of time until the debt is settled.
The settlement stage involves the paying of the settlement amount and the subsequent dismissal of the debt and occurs once a figure has been agreed upon.
Some people like to claim there is a distinction between debt settlement and negotiation based on the following guidelines. If the consumer or business has a lump sum of money already available to them when they hire a debt company or debt lawyer, the process is called debt settlement, as the settlement can take place right away. On the other hand, if the consumer has no money at the moment, and needs to build up funds over time while the negotiation takes place with their creditors, this is called a debt negotiation.
Quite frankly, I fail to see the difference. Even in the above example where the consumer already has a lump sum available to them, the process still involves "negotiation" before a "settlement" can be reached.
If you are struggling, trying to get your head around all of the terminology surrounding the debt help industry don't worry. The interchangeable use of the terms debt settlement and debt negotiation is just one example of how confusing things can sometimes be. The important thing is that you understand what each debt help option involves, and make sure that you don't opt for one that is not suitable for you and your financial situation.