Debt Consolodation

You have to be careful about working with those companies.  The way the get you a lower payment is by lenghtening the term of your debt.  The true killer of a loan is the length of time you are paying it back.  I would go to a local bank first to see what they might be able to help you with.  It is harder to refinance through a bank, but it is well worth it.

Debt consolidation service like negotiating and lowering your debt is called as debt settlement. It does help you in reducing your debt amount but it effects your credit. If you are in deep debts then it is a good option to go for, you can build your credit later once you are debt free. I took help of freedom debt relief (freedomdebtrelief.com) to settle my debts, after analyzing my income and debt levels they said i could become debt free in another 1 year. Its been a more than a year now into their program and I am almost debt free.

You should first try to negotiate directly.  These debt reconsolidation companies will often skim off the top.  However they are providing a service in seeing what assets you can draw on to get rid of high interest debt.  You need to find a reputable firm.

If you are completely drowning in debt bamkruptcy may be another option.