Did you know the average debt per American household is over $9,000? If not managed carefully, even smaller amounts of debt can rapidly spin out of control. If you only make minimum payments on credit cards, have been refused credit recently, use a large part of your paycheck to pay off debt, or receive calls or letters from collection agencies, these are warning signs you need to manage and reduce your debt before it gets even worse. You can take control of your debt and work towards reducing or eliminating debt completely by understanding the basics of debt consolidation.

If done carefully, debt consolidation can get you lower interest rates and monthly payments, stop those calls from collection agencies, and even result in a single monthly payment you make to your debt consolidation agency. As soon as you decide to manage and reduce your debt, there are several things you can, and should, do before exploring your debt consolidation options. First, get a handle on exactly how much you owe, and to whom. This may include credit cards, loans, and other payments. For each debt, list the total amount you owe and the interest rate. You should now have a complete picture of all your debts.

If you think you are unable to manage your debt your

self, try and seek help from a reputable debt consolidation agency sooner rather than later, because the longer you wait, the worse your debt will become. A good agency will help you find the best solution for your needs, and interact on your behalf with credit card companies, collection agencies, and other debtors. To avoid 'fly-by-night' operators in what is still a largely unregulated market, always check an agency's record with your local Better Business Bureau.

Now that you know the basics of debt consolidation, you can start your search for the solution that best fits your needs!

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