Credit
Counseling Tips
Credit counseling
professionals can help you manage debts and teach you how to use credit wisely.
A counselor will ask you questions about your income and expenses and then they will
give you options or recommendations for your financial problems. They will help you create a budget, manage your money, and work out a payment
plan with your creditors. When you have not been able to fix your debt problems
yourself, a professional can be very valuable.
Choosing a credit counseling or debt agency is very important. The best way is to choose an agency that has a good reputation and some happy clients. They
should be able to offer you personalized services for your financial needs. Review several agencies and ask friends if they know of any they would
recommend. Look online and in the phone book for agencies. You can contact the National Foundation for Credit Counseling (http://www.nfcc.org) or the
Association of Independent Consumer Credit Counseling Agencies (http://www.aiccca.org) for a list of members.
Check to see if the agency is licensed and accredited. Many states require credit counseling organizations to register or get a license before offering credit
counseling or debt management plans. If an agency has not followed the requirements for your state, don't use them. Check to see if the agency
belongs to the National Foundation for Credit Counseling or the Association of Independent Consumer Credit Counseling Agencies as they must adhere to strict
standards and use certified credit counselors. Be sure to ask if counselors are
certified and by whom.
Services should be personalized to fit your personal financial
needs and you should not get a debt plan that all clients use. A plan should be created to fit your circumstances along with how you can avoid future
financial problems. Your privacy and security is important and you will need assurance your information will be kept confidential. Review their
privacy policy and how they protect your information. Make sure you know exactly what services they offer.
Contact your Better Business Bureau, check for complaint records, and the local consumer protection agency to find out
information about the agency. Complaints can be a sign of problems. Get everything in writing with a formal written agreement or contract. Read the terms of
the agreement or contract. It should describe the services, the payment terms, the total cost, the length of time involved for the services, and the counselor's name, business name, address and contact
information.
Make sure you understand the fees you will be charged. Check to see if there are set-up fees, monthly fees, or any other fees. Monthly fees should be added
to your debt information and the fees should not hinder your effort to pay off
your debts. If fees are too high, consider other agencies or ask for a reduction in
fees. Find out if your creditors are paid 100% of the money you pay through the credit counseling agency.
When debts are out of control and getting out of debt has not been possible,
professional services can help.
