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If you have several creditors on your tail (and in your mailbox, answering machine, unread emails, and your phone’s missed calls log), then you’ve probably heard of a debt consolidation loan. Here’s a tip: Get one.

Debt consolidation programs are being offered by professional debt relief companies to help people like you settle their dues in the most convenient way possible. They consolidate all your unsecured debts into a single loan that you will have to pay off through affordable plans with lower monthly interest rates.

Before making a commitment to avail of a debt consolidation loan, you must familiarize yourself with the various stages involved in this type of debt relief program. Here’s how it works:

Step 1: Financial Counseling – Most debt consolidators give free financial counseling to assess an interested client’s financial health. This will help them get an idea of how much debt you are burdened with. After they calculate your total outstanding payments, they will offer a free counseling session you could attend to receive handy tips that will help you solve your financial problems. They will provide you with the information on the terms and agreements of the most suitable debt consolidation plan for your situation. Here, you must ask all the questions you have in mind so that everything will be clear to you before you make any commitments.

Step 2: Signing of Agreement – When you are finally sure that you want to commit to a debt consolidation plan, the next thing to do is ask for the written agreement to be sent to your home. Make sure you read each and every clause before signing. If you have any questions and doubts on any part of the agreement, ask the consolidator. Don’t sign unless everything is clear to you.

Step 3: Informing your Creditors – After you have signed the agreement and sent a copy to the consolidator, contact your debt collectors/creditors to inform them of your enrollment to the program. All creditor calls should be made to your consolidation company, and if ever a creditor makes a call to you, simply remind him to contact the consolidators instead in the future.

Step 4: Payment Plan – The consolidator must then give you the payment plan that will be most suitable for your situation. He will forward a copy to you and your debt collectors. This is the part where the consolidator will also negotiate for lower interest rates and look for ways to eliminate the need to be charged with late payment fees.

Step 5: Making Payments – Once the creditors agree to accept the consolidator’s payment plan, you then start making payments to the consolidation company. They will be the ones to handle distributing your payment to settle your various debts.

Finally, when all these are done and you are successful in making transactions with your chosen debt consolidation agency, try to have you financial health re-evaluated. You can have it checked by the same consolidator who counseled you at first or contact another professional who can crunch the numbers for you. If your financial health seems to be deteriorating, inform your consolidator to see what can be done.