Bankrate has an excellent review of common misconceptions of debt management. Here is the next installment: Debt Consolidation Always Saves You Money..

As like in the case of any other financial products, be viligant about what you sign up for. Read the fine prints before you sign your name in a debt consolidation agreement.

Better ask a calculator to determine the truth of this statement for your situation. For example, if a lender assures you it can secure financing with no out-of-pocket costs, that doesn't mean it's a kinder, gentler source of funds. It's code for "We're rolling our fees into your loan, where they are also subject to the interest rate."

The truly unfortunate fall victim to flipping -- a process that ruined one of Musci's elderly clients. A lender offers a debt-consolidation loan plus cash out, with no out-of-pocket fees. A year later, it calls again to say that since your home has appreciated, could you use more cash? Say yes, and they again sock you with fees hidden into those monthly payments. This cycle continues until you break.

"The consumer thinks this person is taking care of them. But in my client's case, the company ran up $15,000 in fees, and put her at 100 percent loan-to-value," says Musci. "She eventually had to sell her house to get out from underneath it."

Deciding on debt consolidation is a simple formula for Greenberg: Compare your existing minimum payments to what your payments will be for that same debt under the DMP, including fees and voluntary contributions. If the latter doesn't save you 5 percent to 10 percent, it's the wrong choice.