Climbing out of credit-card debt

(FORTUNE Small Business) -- Dear FSB: I am a small business owner (S-Corp) with over $100,000 in credit-card debt. Due to sharp drop in home sales and lack of cash flow, we are having a difficult time paying these credit cards. Being a business owner, I am looking for a program to combine and pay these cards off without having an adverse effect on my credit score. Your advice in this matter is greatly appreciated.

- Mark Khoshnevissan, Elizabethtown, Pa.

Dear Mark: FSB's credit experts recommended some immediate steps for you to take either on your own, or with a credit counseling agency.

"The first thing you should do is STOP using the credit cards," says Michelle Dunn, collection expert and author of The Ultimate Credit and Collection Handbook. Then "call each credit card company, cancel the cards and set up a payment plan."

It's imperative that you are the one who cancels the card, before you become past due on a payment and the credit card company beats you to it. Closing accounts at your request will result in a higher credit score, says Dunn.

Also, communicate. Don't be afraid to call the credit card company to set up payments, and let them know you are in trouble.

"Most times when you cancel a card, they will give you credit on some fees, interest charges or other things that contribute to your high balance," says Dunn. "Most companies will not do this unless you cancel the card."

You can also try reaching out to your individual creditors. "Discuss your situation and explain that you are willing to pay off your debts. You may be able to arrange payment plans or negotiate a reduced settlement amount," says Nelson Santiago, a consumer advocate at Consumer Action.

Santiago recommends asking each creditor to agree to a voluntary plan for the repayment of your debts.

"See if they will reduce any interest or penalties that you owe. If you reduce your other expenses, it may be possible to pay off your debts in a reasonable time," he suggests.

Another alternative is to consider credit counseling, especially if your creditors are unwilling to work with you. There are many reputable credit counseling organizations offering credit education, credit review, budgeting workshops and debt management plans - but there also disreputable companies looking to prey on the vulnerable.

To find a credit counseling organization near you, Consumer Action recommends contacting the National Foundation on Consumer Credit (NFCC) online or by phone at 800-388-2227. Many NFCC-affiliated credit counselors have fees based on a sliding scale depending on your income who will contact creditors on your behalf. Sometimes creditors will waive interest charges and late fees when you enroll in an established debt management plan.

Deal only with qualified credit counseling agencies - walk away from any offers that claim you can wipe out your debts, says Santiago.