Debt and bill consolidation companies are credit management companies that engage in administering debt consolidation programs. Debt consolidation programs are for people who have multiple loans, which are normally unsecured loans, and would like to take out a single secured loan to pay off the multiple loans. It helps the debtor since unsecured loans, like credit card balances, come at a high interest rate, whereas a secured loan, like a loan on a home or property, comes at a substantially lower rate.

Debt and bill consolidation companies work by conducting a thorough analysis of the debt situation of the client, and working with the creditors to reduce and eliminate debt. They also initiate contact with third-party collection agencies to stop them from sending collection letters and making embarrassing calls to their client. Most of the debt consolidation companies also offer debt counseling services, since the practice has been that clients revert to their high debt levels a few years into the program.

Debt consolidation companies normally charge a fee from the client, which is reflected in the monthly statement that the client receives. This industry has witnessed intense competition in recent years, resulting in some companies offering free debt and bill consolidation services. Increased debt levels and desperation among American citizens have also seen a few companies fleecing customers with high fees, or not delivering on the promises initially made. A case in point is the decision by prominent debt consolidation company AmeriDebt to shut down its debt management division following a settlement with the Federal Trade Commission over a case of cheating its clients.

Almost all of the debt consolidation companies have websites, and most are just a phone call away. The prominent ones advertise on television and radio. However, it would be prudent for consumers to check with the Federal Trade Commission or the Better Business Bureau before engaging a debt and bill consolidation company to manage their debt.