Debt consolidation companies have been established to help debtors reduce their debt burden. They provide assistance in reducing the amount of money owed by negotiating with creditors. Sometimes they can reduce debt burden by almost 60%.

These companies also save you from the hassle of filing bankruptcy. They basically work to consolidate all your debts into a single unit so that you have one affordable monthly debt payment and negotiate with your creditors for acceptance of some terms and conditions of the loans.

They evaluate your present situation and come up with an easy repayment plan for you. For this they ask you for details of your finances and start working on an easily manageable budget. They offer all their services for a fee and the fee is added to the monthly debt payments.

Once you start working with them, they send proposals to your creditors on your behalf. This proposal tells the creditors that you are working with a certain debt consolidation company to pay off their loans and you expect them to cooperate with you. For sending the proposal to your creditors, the company requires certain details including your account number, total amount of money owed, your income and expenses, the names of your creditors, the proposed repayment amount, repayment date and so on.

Reputable agencies do not work only for profit, but genuinely want to help their clients with their debt problems. They have a strong network which makes negotiations easy and hassle free.

These companies  help you reduce the monthly payments as well as improve your bad credit score. They improve your credit score by eliminating the cause of damage, that is, nonpayment of dues or late payments. They therefore, help you maintain your creditworthiness and thus avoid being labeled as a loan defaulter. If you do not use the help of a debt consolidation agency to improve your credit score, then you will have to face a lot of problems in getting a loan when you need it in the future.

Thus, if you are swimming in debts and are facing a hard time due to this, then consider contacting a debt consolidation company for help before the situation deteriorates further.