Don't focus on everything at once. Take one bill at a time and pay them off. One check send something on the car, next bill send something on the student loans next send something on whatever else you have. They will demand that you pay it in full but just send them what you got. It worked for me.

The first step is to compile all of your statements, and figure out how much total debt you have. Call your bank or financial institution and make an appointment with a debt counselor. Many banks provide this service free of charge to members. Bring all of the statements you have gathered, and the counselor will help you come up with a re-payment plan, and provide you with some helpful tips on how to live on less while getting out of debt. The bottom line is, seek help from an expert...it's amazing what options are available out there if you just look for them.

Some things we have had to do: Cut all non-essentials. Like TV. Like (gasp!) the internet. Especially if you're kidless and not in school, you an probably get a second, part-time job for weekends or evenings. All this should be pretty common-sense up to this point. Be very, very careful of debt consolidation; many of those places are in it for a profit. Yeah, it'll cut back to just one bill- but you'll be paying that bill longer because of their interest rates. If you go into debt consolidation, really investigate the place, and ask for a list of references from them. Find some happy customers- and then, see if you can't find some unhappy ones. That being said, there are some places that are worth it; you just need to make sure you understand everything going in first. Understand that it takes years and years to get out of debt; if you find a place promising to get you out of debt in a short time, that's almost certainly a sign of a rip-off. Be patient. Cut back everything you possibly can; if that means turning down the thermostat a few degrees- or up a few degrees in warm weather- do so. And buy nothing but hotdogs. Well, maybe not, but if you're not buying generic food now, well, that's a great way to cut back on food expenses! Well, a rambling answer... but an answer nonetheless.

I did debt consolidation and it works, but if you can work something out with banks collection dept that maybe a better way to go.

Mary Hunt has lots of good ideas for just this problem at <everydaycheapskate.com>. (I have no connection with these people.)

Sorry to hear about your situation - that's really stressful. I worked at banks for a few years, so I should be able to give some pretty reasonable advice here. The truth is the answer is very simple and you probably already know it. You need to keep chipping away at the debt with regular payments, and not run up any new debt under any circumstances. Debt consolidation is only a good idea if it's not going to cost you more, and it might. Check out the interest rates, fees and terms to be sure. One of the very best things you can do is call up your credit card company or bank etc and make a payment arrangement where you can pay a fixed amount every month. It will be less than your installment would usually be, so it makes your bills more manageable, and they'll freeze your line of credit so you can't run up any more debt. The main advantage of making an arrangement is that you're communicating with them, which they love because it makes them less anxious about getting their money back :) Keep talking to them, even if you can't pay sometimes, and they'll look favourably on your situation e.g. not giving you a bad credit report etc. Another good thing to do is to give yourself a sense of progress by paying off one small debt totally so you can have the pleasure of cutting up the card and chucking it out :) Good luck!

Washington Post columnist Carolyn Hax has this advice: contact www.debtadvice.org

Go to my website at: www.EzDebtBgone.com It's talking mainly about mortgages, but we just released a new program that will help you eliminate all debt. The owners of our company just received the Ernst & Young award for Entreprenuer of the Year in financial services. We do a free debt analysis to see if you qualify, and how soon everything will be paid, and how much interest you'll save.

invest twice weekly in the lottery.

Debt consolidation may end up costing you a LOT more than your current debt. I would advise you against doing that. I would speak with National Foundation for Credit Counseling http://www.nfcc.org who can guide you through your situation. Its a free service, unlike debt consolidation and they have contacts in credit companies that you can't access yourself.

Well, the first action is obvious. Stop spending! You're obviously living beyond your means. If you don't do this first any attempt to pay down your debt will be futile. Cut out EVERYTHING. If you have a cell phone and a land line; Cut out the land line, and get a minimum minutes plan on your cell phone. Gym membership, AX it. walking is free. Internet: AX it, use the public library. Cable/satilite TV; AX it, you can use the free time for another job. Food; Yayyyyy RAMEN!. Car; pay it off, run it 'till it dies. Never use a credit card again, burn them all! If you don't have the cash, you can't afford it. It'll be hard, ignomonius at times. but once you get your bills straight you'll find you can build wealth almost as fast as you amassed debt.

If you do consolidate be aware of the scams out there, check out these links. http://money.howstuffworks.com/personal-finance/debt-management/debt-consolidation4.htm http://www.smartcreditinfo.com/scams.html