Nick D is right…
Additonal things to consider:
1. Pay off your highest rate cards/debts first. STOP USING CREDIT CARDS and pare them down. Revolving credit is a kiler to your budget.
2. Contact your debtors and see if you can negotiate a lower rate of interest in return for discontinuing use of the card.
3. Some agencies offer debt counseling at no charge. Check with your local social services agencies and other non-profits in the area to see if they can help or provide referrals.
Good luck.

Good question!

Usually what these companies will do is one of two things: they will either pay your debt off and then make money off of charging you interest as you pay them back, or they will negotiate with your lenders for lower interest rates, which means you won’t have to pay as much each month, then they charge you a fee for having negotiated these rates down, or they take a portion of your monthly payment before they pay the new lower monthly payments on your old bills.

If you’re ever considering using one of these companies, know two things: 1.) That if your budget doesn’t balance then you will still be worse off a year or so from now, becuase you’re still spending more than you’re bringing in; and 2) that usually using these companies does show up on your credit report and it usually has a negative effect - you just have to decide how bad it is and if it’s worse to leave things as they are or use one of these companies.

For more information, here’s a pretty good article:

Hope this helps, good luck!