by 
The Curious Bag
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<h4 class="dechead">On One Hand: Depends on Your Situation
Debt consolidation works best if you own a home, take out a second mortgage or home equity line of credit, and pay off your bills using that. The idea is that you will have a lower interest rate when you consolidate than what you were paying before and only one payment, making it easier to make your payment and keep track of your debt. Another option is to try to get a personal loan with a lower rate than what you currently pay. This may be a tougher option if your credit is poor.
On the Other: You Could Lose Your Home
Even though a second mortgage or a HELOC can be a good option, putting your home up as collateral puts your home on the line. If you make chronically late payments or miss payments on your second mortgage or HELOC, you could lose your home.
Bottom Line
Analyze your situation if you are in debt. Determine if it will be advantageous to consolidate your debt. If not, other methods available to you are to start and stick with a budget, get credit counseling, file bankruptcy or try to negotiate your debt.
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