Before you say this sounds too good to be true, keep in mind that your creditors are not lowering your interest rate and making it easier for you to make smaller payments out of the goodness of their heart. They realize that if they don't help you out a little, you may file bankruptcy and they will likely collect nothing. Through debt consolidation services they can at least recoup the principal on the debt.

In addition, you will notice that most debt consolidation companies are organized as "non-profit" companies. This allows the credit companies to recoup a significant portion of the "lost interest charges" through tax write-offs.

So take advantage of this great service. It seems to be one of the few true win win situations out there for the consumer.

Why can't I just file for bankruptcy?