One fine morning you get the bad news that your credit score has fallen by 80 points. The reason is that you have defaulted in repayment of your loans by a couple of months. It would be a real awful experience receiving such messages all of a sudden.

You are not the only person in such precarious situations. Thousands of fellow citizens in USA alone are facing similar fate. With the economic recession at one of its worst ever phases, the condition becomes even more delicate for the sufferer.

Debt Consolidation in such conditions is considered by many to be the only way out. The question is that how a person with bad credit report can possibly avail a debt consolidation. You neither need nor worry much on that count. There are several lenders who will come forward to consolidate your loans with a bigger loan despite your bad credit reports. And it includes a few banks too.

These financial institutions work on the conception that despite your recent economic slump you still have the potential to repay all or most of your outstanding debts. Such outstanding debts could be regular transaction or contract debts or the latest syndrome of Credit Card Debt.

Contrary to the popular belief that debt consolidation facilities are not available to people with bad credit, they are available for such people even more than others having good credit reports. Rapid increase in the number of people with bad credit score seeking loan consolidation, the financial institutions are also allowing such loan consolidation making their eligibility criteria less stringent.