Which is better - a debt settlement company or a law firm?

Why are you thinking about settling your debts? How much debts do you owe? What type of debt do you owe?
There are many other options to get out of debts like taking out a consolidation loan, following debt snowball or avalanche method, considering balance transfer etc.
If you want to settle, your debts, then do check the authenticity of the settlement company before signing any agreement.
Check whether or not they are licensed to run the business. This is applicable for hiring a lawyer as well. The attorney should be licensed and uphold strict ethical standards.

A law firm is better than a settlement company since they follow the FTC rules. Plus, they have attorneys who know debt laws very well. Attorneys can help you if a creditor files a lawsuit against you. Suppose, a creditor has filed a lawsuit against you. The attorney can help to settle debt out of the court.

Check the client testimonials and the fee structure. Find out if the existing customers are happy.

It is better to choose a law firm but you should choose a good and reputed one.
How will you do so?
Check out the BBB rating along with reviews of clients - whether or not they're satisfied with the services offered. Also, it is better to choose an organization that is into business for at least 3-5 years. You can take referrals from your friends and relives to choose a good company.

Choose a reputed law firm, there's no doubt about that. Check BBB rating, read online reviews given by the current clients of that law firm, and don't forget to check their total work history.