In other words, the loan can’t be secured by collateral (for example, home loans and auto loans would not work).Unsecured debts include loans such as credit cards, personal loans, and some student loans.Start with organizations that have a strong reputation.The National Foundation for Credit Counseling (NFCC) certifies counselors and sets certain requirements for member organizations, and that’s a good place to start.If you have good credit and sufficient income, a debt consolidation loan might be your best option.Compare fees you’ll pay for a loan or a program, and decide what’s best.The first step toward taking control of your financial situation is to do a realistic assessment of how much money you take in and how much money you spend. Then, list your "fixed" expenses — those that are the same each month — like mortgage payments or rent, car payments, and insurance premiums.Next, list the expenses that vary — like groceries, entertainment, and clothing.
Unsecured loans only: debt consolidation programs are for debt only.A debt consolidation program is a service to help you manage your debt.With the help of a nonprofit credit counseling agency or for-profit company, you’ll set up a plan and a system to eliminate debt within three to five years.Whether the crisis is caused by personal or family illness, the loss of a job, or overspending, it can seem overwhelming. Your financial situation doesn’t have to go from bad to worse.If you or someone you know is in financial hot water, consider these options: self-help using realistic budgeting and other techniques; debt relief services, like credit counseling or debt settlement from a reputable organization; debt consolidation; or bankruptcy. It depends on your level of debt, your level of discipline, and your prospects for the future. Are you worried about losing your home or your car? Many people face a financial crisis at some point in their lives. Are your accounts being turned over to debt collectors?Effect on credit: using a debt management program may damage your credit.Your service provider will negotiate with lenders, and you’ll probably end up paying less than you were supposed to pay each month. If you had perfect credit before a consolidation program, you’ll definitely notice the hit.A debt consolidation program is a service that involves combining multiple loans into a single payment.In most cases, a “program” is a , which we’ll explain below, is a service to help pay off your debts where they are.