How To Find a Debt Consolidation Program

A debt consolidation program doesn't reduce the amount of debt you have, it just combines it and often extends your terms. You will usually have a lower single bill than you did when you had multiple bills to different companies. However, you still have to pay that debt. And many people who can't control their spending find themselves even further in debt because they had some free space open up on those credit cards after they consolidated the balance somewhere else! But if you do want to pay your bills and you need some help lowering the monthly total in order to do that, where do you look? Here's how to find a debt consolidation program.

One of the most obvious places to look is the equity in your home. Many people have taken a second mortgage to pay off the credit cards and car loans that they own. Any place that you can get a mortgage loan is a place to start. Your current credit union or bank should be near the top of your list. Remember though, if you can stop the spending, this might be a good idea. But a large percentage of the population soon finds that they've loaded up the credit cards again PLUS they now have additional debt on their house.

One of the advantages of "doing it yourself" is that if you are truly doing a debt consolidation, and not a debt reduction program, your credit probably won't take a hit. After all, you aren't asking for a reduction in the amount you owe, you're paying it off - which looks good - even if you are putting the debt somewhere else. What this also means is that you don't really need to pay anyone else any fees to get this done. Find a loan from Lending Tree, Bankrate, your personal bank or credit union, your mortgage company or any other reputable lender. You get a lower payment, your original loans get paid off and your credit score doesn't get slaughtered. 

Remember that if you are asking the lender to reduce the amount you currently owe, they will almost certainly put a note on your credit report which will lower your credit score. Of course the general consensus is that a debt reduction program probably is less of a black mark on your credit score than an actual bankruptcy is. So you'll need to decide what the best direction is for your situation. 

If you can make use of a debt consolidation plan, and not only stick to the new payments but also don't load up with additional new debt, you might find that this is the best option overall.