 TITLE: How to Combat Debt Shame CONTENT: 4\\. Find the Best Way to Deal With Your Debt\n--------------------------------------------\nAfter budgeting and discussing possible options, you may still find yourself confused or with fewer funds than you need each month to effectively reduce your debt. If that happens, consider these strategies:\n*   **Debt consolidation.** A debt consolidation loan or balance transfer credit card enables you to fuse your higher interest rates into one lower interest debt, decreasing the total amount of interest you will pay overall. Lower interest rates put more money in your pocket, allowing you to put more money toward paying off your debt.\n*   **Negotiating with your lenders.** If you have a good credit score and a positive payment history, credit card companies may agree to offer you a lower interest rate, eliminate late fees or reduce your minimum monthly payment. By communicating your needs and advocating for yourself, lenders may be more likely to help you—but you won't know if you don't ask.\n*   **Debt management.** Noted above, nonprofit credit counseling agencies can help you come up with a plan for attacking your debt. They may suggest a debt management plan, in which your credit counselor will negotiate with your creditors on your behalf to try to reduce interest rates, fees or even the amount you owe. Once the plan is in place, you'll make payments to the credit counselor, who will in turn pay your creditors.\n*   **Debt settlement.** Third-party companies may promise to confer with your creditors on your behalf to curtail your payments—for a fee. Generally, debt settlement firms negotiate to pay your lenders a lump sum that is less than the total you owe. While they do so, which can take months or longer, they'll require you to stop paying your debt. When late payments accumulate and collection agencies start to call, your credit will suffer serious damage. In addition, anytime you pay less than the entirety of your debt, your credit report will show that the account has been settled for less than the full balance owed. While these companies may be able to help in some situations, the potential hit to your credit should make them a last resort. END