Debt consolidation essentially means taking one loan to pay off all other loans. It's almost always easier to pay off one loan at a lower interest rate or fixed interest rate, than to pay off many at varied rates. Most individuals have a credit card debt, a mortgage, and sometimes a second mortgage to pay off.

A debt consolidation loan without collateral! Sounds strange! You are right, but not in the context of recent loan market.

Negotiate or settle your debt with your creditors instead of filing bankruptcy. This will not damage your credit as much and you might not have to pay all that you owe.

There is always a way to dig yourself out of debt, even when all seems hopeless. There are things like self repayment plans, equity loans, debt consolidation, credit counseling, debt settlement and even bankruptcy are all viable options for you to consider. Taking a good long look at them all will help you to make a good decision about which one is right for your own personal circumstances.