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Debt Consolidation Loans are not the only way to consolidate your debt, there are many other financial options to reduce your monthly payments and cut on your overall debt. With this information you will be able to see which option best suits your needs and start the process of eliminating debt.

Credit Counseling Agencies

There are agencies that will guide you through the process of consolidating your debt for a small fee. If you are not familiar with financial concepts and are not used to dealing with budgets, interest rates, loan terms, etc. this is probably the best option for you. You practically will not have to do anything; instead, the credit counseling agency will prepare a budget for you, activate its agreements with financial companies and debt collectors and reduce the overall amount you pay monthly. You will then have to make a significantly smaller payment to the credit counseling agency each month and the agency will take care of the rest.

Bear in mind though, that there are many scams going around with some fake agencies that will ask for money and then do nothing. Not only you would be loosing the fee, you would also be incurring in delinquencies with your creditors by missing payments or paying late. There are some online companies that provide access to many lenders, debt negotiators and credit counseling agencies that make sure all of them are legit.

Debt Consolidation Loan

A debt consolidation loan is a loan you take in order to repay all the other debt. The key to consolidation loans is that if you can get a competitive interest rate, you can save thousands of dollars in interests. However, in order to get a good deal on consolidation loans, you will probably have to provide some kind of collateral. There are unsecured consolidation loans but the interest rate can turn out to be too high for its purpose.

Debt Consolidation * Negotiation

Another excellent way to consolidate your debt is to resort to the aid of professional negotiators that usually offer their services online. You will find there are online companies usually referred as Debt Consolidation Agencies, that will undertake negotiation with your creditors and agree to new repayment schedules with a considerable reduction on the interest rate charged and sometimes even a cut on the debt's principal.

These agencies can reduce your overall debt by up to 60% while at the same time ending those bothersome calls and letters from debt collectors. Your monthly payments will be considerably reduced and your repayment program extended so you can afford the payments without making huge sacrifices.

These agencies, however, charge a small fee for their services. Nevertheless, some of them take care of all your payments and include the fee in the monthly installments. Given all the money you would be saving, the small fee will pass unnoticed. As with Credit Counseling Agencies you need to be wary of illegitimate agencies that you might run into.