The reasons for this are widespread but typically include credit card debt, loan debt, Car Loans (believe it or not), or mortgage problems.

All of these things are debt of one type or another and during our study we have found that there is a typical pattern of events surrounding the persons problems. Read on and see if this sounds familiar:

1. Person has a job, not brilliantly paid but a paying job

2. Person feels comfy so gets a loan to buy ‘x' with (Car, kitchen, holiday, etc)

3. Person then either

a. Loses job

b. Acquires more loans (because they need more stuff)

4. The debt that they've acquired then starts eating away at what ever money was left at the end of the month

5. Person borrow more money to help prop up the existing debts, usually with credit card spending

6. Points 4 and 5 then get repeated until suddenly the monthly out goings are more than the incomings

And suddenly the person finds themselves in trouble because each month the debt gets bigger and bigger.

Sound familiar?

There are probably some of you reading this thinking ‘What is he talking about?', rest assured there are those reading this right now having just experienced a cold chill.

One of the options that ‘Person' usually overlooks is the value of the house that they are living in, a simple mistake (because realistically who wants to gamble the roof over their head?).

There are two clear ways out for Person, he can either sell the property (in which case a series of new problems come to light – like finding somewhere else to live) or more intelligently he could refinance the property (the technical name for this is ‘Refinance Home Equity' / 'Refinance Home Mortgage').

Most banks will do this for you (assuming you haven't already upset them) or you can approach a private company for a ‘Home Equity Loan'.

The thing to remember about refinancing your home (whether ‘Refinance Home Equity' via a bank or ‘Home Equity Loan' via a loan company) you are essentially borrowing money against the value of your home, and so if you default on this loan (or remortgage) then you are going to be in real trouble.

To limit the potential for problems you should:

1. Find local refinance companies – they'll be more sympathetic to your situation

2. Find the best refinance loan rate or Home Equity Refinance rate

3. Clear credit card debt first – this is typically the most expensive type of loan

4. Don't refinance just to buy a car – if you're not doing well don't go OTT

5. Whether you're looking at mortgage loans or equity loans be sure to shop around – the larger banks might make an offer to stop you using the smaller refinance provider

This may seem like very simple advice to many people but for some, who have worked themselves into a rut it's handy to be reminded.

And don't forget, by intelligent use of credit and refinance you can solve your debt problems.