You know you are in trouble. There are piles of opened bills sitting there on the table, and even more on the dresser that you haven't even bothered to open. Your family and your friends aren't going to loan it to you. You have spent more than you can realistically expect to earn any time in the foreseeable future, and you simply can't bet on winning the lotto. So, is there really anything you can do to help yourself get out of this mess you have made? Maybe, just maybe, you should consider consolidating debts or seeking credit counseling.

Debt consolidation has become a household word and ever popular method to tackling outstanding debts. While it got its start on the internet during the dot-com boom, debt consolidators have also taken to advertising on television and radio spots. The increased exposure from the ads brought about more awareness of the concepts that drive the debt consolidation agencies and as a result has encouraged people to look for ways of crawling out from underneath all the consumer and student loan debts.

There are, like anything, good and bad debt consolidation agencies. With the increased publicity and advertising, the government has became more and more aware of the differences between the agencies and some agencies have found themselves facing costly lawsuits.

Understanding debt consolidation is important before one actually looks to it as a solution. Debt consolidation is taking and lumping all of the outstanding bills you might have – consumer/credit card debt, student loans, personal loans, etc. and taking those debts to the debt consolidation representative. The representative will then communicate with each of the debtors and ask them to cooperate with creating better terms – sometimes this means lower interest, lower payments over longer periods of time, etc. Consolidating debt does not erase valid debt, but instead the work to find a solution to repaying the debt that better meets your personal and financial needs. New buzzwords given to the concept include debt negotiation or debt settlement. Regardless of the name given to it, the concept and procedure remain the same.

You may wonder if the consolidate debt solution is too good to be true. That depends. As is the case with almost any financial topic, debt reduction has its cheerleaders and its critics. As a consumer it is really your responsibility to look carefully at the pros and cons and make the best possible decision for your particular circumstance. You will need to research companies and find one that seems worth taking a chance on. Ask agencies like the Better Business Bureau for their recommendations based upon complaints and feedback they have received. You may decide that rather than take your debts to another agency, you will save yourself the fee and speak one-on-one with your creditors. Many creditors will appreciate the sincere effort you are making and work with you. Once you have your current financial woes under control, consider taking some classes in how to better create a budget and financial plan that will let you avoid future trouble. You will be very glad you did.