Debt consolidation has become a well known phrase as so many people seem to get themselves into debt.
It is far too easy to get credit and many people who do not have the sense of responsibility to be handling credit cards and store charge cards have got them.
It is too easy to buy things you cannot afford and charge them to some form of credit card.
It is easy to console your self with the thought that the monthly payment is a small amount that you can afford.
Unfortunately all these "small" amounts add up and you could find yourself in the position that you owe too much for you to be able to afford in a month.
The logical thing to do you would think, is to pay a few creditors one month and the rest the following month.
This you will soon find out does not work.
The creditors will not agree with your system and will start adding interest on your accounts for late payment.
Now you will have the situation where the balances on your accounts will be increasing instead of decreasing.
The amounts will grow to amounts that you will not be able to pay off unless you make a drastic plan.
You are now left with two options, either you file for bankruptcy or you consolidate your debts, borrow money from a bank and pay them all off so that you will have a clean slate.
You will have to shop around first and find out which loan will be the best for you to get for this purpose.
You will want to find the bank or money lender that will give you absolutely the best interest rate there is.
You do not want to have to pay more interest than what is necessary.
The best loan will probably be the personal loan.
There are lending agencies that advertise their interest rates online and some of them specialize in personal loans.
If you are a home owner you could either apply for a home equity loan or you could take a second mortgage on your home if you owe your creditors large amounts of money.