If you are so in debt that it becomes a problem, you are not alone. More and more people are paying as much as possible, only to see their outstanding balances stay the same or increase. And that’s after paying more than the minimum amount due. In short, I’m having trouble. It makes sense that you would want to know how to consolidate your debt, which allows you to pay off what you owe in a short time, gives you lower monthly payments and does not negatively impact your credit score.

While most people think of debt consolidation loans, the truth is that there is no better way to consolidate debt.In fact, you have several options to choose from. That doesn’t mean loans are a bad choice, it just means they’re not the only choice.

To paraphrase Carl Walins, a respected financial adviser, “People often think of consolidation loans first, but there is more than one way to consolidate your debts. For example, a good way to consolidate all loans and to have a monthly payment, is done by working with a licensed credit counseling agency.These agencies can make arrangements with most creditors to give you better terms, keep your credit score where it is, and avoid having to take out an additional loan.”

One Another of the most common ways people think of when it comes to consolidating debt is to transfer high-rate credit card balances to low rate cards. On the surface, it’s a good idea.However, you must be very careful because each credit card company has different conditions for balance transfers. Although the initial rate may be quite favorable, it may only be temporary and therefore the rate may be higher than what you are currently paying. Some companies also allow you to transfer as much as you want, but only apply the best rate to the first few thousand dollars. Another thing to watch out for is balance transfer fees. Walins sums it up nicely when he cautions, “Beware of the fine print.”

If the options above don’t work for you and you need to take out a debt consolidation loan, see if you can get a secured loan.The most common form is the home equity loan. The good thing about doing it this way is that you will get a lower rate than other loans because the lender is exposed to less risk because they have collateral in the form of your home. Of course, this isn’t always true, so it’s up to you to compare the rates, terms, and overall cost of different loans before deciding which is best for consolidating your debt in your specific situation.