Most consumers are by now aware of the debt consolidation program. To be honest, for anyone who watched television, entered a bank, opened a newspaper, or switched on a radio in the last few years, it would be rather more odd had they not heard of debt consolidation. With credit card debt running out of control for seemingly every American consumer, the debt consolidation industry has an obvious temptation for most of the populace. It should not be surprising that most of our citizens have at least thought about debt consolidation. As bills spiral and collection agents harass ordinary borrowers who have lost track of their household budgets, the notion of consolidating their various debts into one larger loan with lower interest rates and lower minimum payments has clear advantages.



This is especially true considering the damage done to bankruptcy protection by the United States congress in happier times. A few years ago, back when the economy seemed to be on a never ending succession of expansionary periods and unemployment was at record lows, the federal government subtly dismissed much of the debt elimination protections formerly enjoyed by those filing for Chapter 7 bankruptcies. With the Internal Revenue Service and multinational credit card corporations united against bankruptcy programs, it seems unlikely consumers will ever again be able to count upon their government to shield them against the actions of predatory lenders.

It's not only the harsher guidelines currently enforced by the IRS that essentially ask debtors to sacrifice the entirety of their possessions. Nowadays, most borrowers could not even qualify for bankruptcy protection as previously imagined. Instead, for those borrowers seeking to declare that still maintain some decent income, they will likely be shifted by court mandated trustees into a Chapter 13 program. Chapter 13 bankruptcies are themselves a sort of debt consolidation program albeit of the type that prevents future loans and ensures that the borrowers will pay back the vast majority of their debts under budgets calculated by the state. One cannot over estimate the damage that bankruptcy shall wreak upon the unlucky filers' FICO scores and credit ratings. Under the system as it stands, there is simply no reason for any but the most desperate consumer to even think about declaring bankruptcy.

Fortunately, several alternatives to bankruptcy protection have developed over the past decade that can provide better options for harried consumers. Once again, most borrowers are at least dimly conscious of these programs, but most of them do not bother to acquaint themselves with the specifics about debt consolidation until they have already developed significant problems with debt balances. This is somewhat understandable. Debts that are unable to be easily repaid cause a reasonable embarrassment, and many consumers find their financial burdens too humiliating to discuss. Moreover, when things are going well, there would simply be no need to think about the necessity of debt consolidation. We certainly recognize the reasons why so many of our countrymen stay blissfully unawares of the practicalities of debt relief, but, all the same, anyone that signs up for credit accounts has really no excuse for remaining ignorant of the solutions available should bills pile.