With a debt consolidation company, typically, you enter into a debt settlement agreement and make monthly payments to the debt settlement company which they will hold in an escrow account.
Once you have built up a reasonable settlement amount in an escrow account, the company will then reach out to your creditor to make a settlement offer. But, there is no guarantee that your creditor will accept the offer. In the meantime, you have been paying money to the debt settlement company while your debt problems continued to grow. If you have multiple accounts you are trying to settle, the problems are compounded. One or more creditors may not wish to settle, and all of your excess income is already committed to the debt consolidation company. The debt consolidation company has no real pull with the creditors. An experienced bankruptcy attorney will have more leverage to negotiate the best possible settlement, because the creditors know that if they do not accept the settlement, they may get nothing if a bankruptcy is filed. This is why debt consolidation services can fail in achieving true debt relief.