Debt consolidation loans aren’t always the best solution to your debt troubles. Before you sign on for a "debt consolidation loan,” consider your alternatives:

Negotiate With Your Creditors - Sometimes your creditors will offer you a lower interest rate, or will waive certain fees associated with your accounts, if you simply call them up and ask. This is most often true of credit card companies.

Debt Consolidation - You may be better served by utilizing a debt management service. With a debt management plan, you deposit an amount of money each month with a service which pays your bills for you. Sometimes creditors will work with your debt management service to offer reduced interest rates or waive certain fees associated with your account.

Using a Traditional Lender - You may also be better served by using a traditional lender, as opposed to a debt consolidation service.

• Unsecured Loans - If your credit is relatively good and you are employed, you may be able to obtain an unsecured "personal" loan which you can use to pay off some of your higher interest debt, such as your credit card debt.
  
  
• Secured Loans - As many debt consolidation services will use your home as collateral, you may well be best served by refinancing your home or obtaining a home equity loan, and using the proceeds to pay off your debts.
  
  

Bankruptcy - There is a possibility that your best option is to declare bankruptcy. If all consolidation will do is forestall an inevitable bankruptcy, consider whether you will be better off proceeding directly to bankruptcy.

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