Legal Question in Credit and Debt Law in Pennsylvania

You should do neither. Debt settlement companies are mostly scams, or, not worth the money that you pay them. I wouldnt file bankruptcy either, if the debt is that old. PA has a 4 year statute of limitations on debt, and if you havent paid on them in 5 years, I wouldnt try to settle with them. Technically, they cannot even sue you to collect the debt. If they do, you would have a lawsuit against them for filing after the statute of limitations.

Mr. Artim is absolutely correct. The only thing you should be aware of is that some credit card companies, when they realize that the debt is uncollectible, "forgive" the debt and report this to the IRS. The IRS then treats the forgiven debt as income, and they want to be paid taxes on this money. So far the only Credit Card company I have experienced this with is Citibank who has sent out a form 1099-C for cancellation of debt. So long as you do not receive any 1099's for this you are alright. As I said, this is the first year I have seen this done. So I would not worry about it, but you should be aware of the Credit Card Company's right to do this.