Choosing a Credit Counselor

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If you’re barely making it between paychecks or are struggling financially, particularly with credit card debt, credit counseling may be a viable option. But how do you know if you’re getting good help? Well, when it comes to choosing a credit counselor, you do need to consider a few factors. Read on for more about this. 

What is Credit Counseling?

Credit counseling is usually a process wherein individuals like you get help with your debt through education, budgeting, and the utilization of a host of tools with the aim of lowering and ultimately erasing your debt.

What Do Credit Counselors Do?

Most counseling agencies are non-profit, which means their services are offered for free or for a nominal fee. But be careful: sometimes there are hidden fees about which you aren’t aware off the bat. 

Credible agencies offer advice on money and debt management. Their trained, certified counselors can assist you in creating a budget, and some organizations provide complimentary educational literature, workshops, and other resources. They can assess your financial situation and help you put together a customized plan to tame your financial woes and provide credit relief.

Also, any credit counseling outfit worth its salt should, upon request, mail you info about the organization and its services without asking for information about your circumstances. In fact, if it doesn’t, keep it movin.’

How Can I Make Sure a Counselor is Legit?

After you’ve compiled a roster of agencies you’re interested in, run the names by your state’s attorney general’s office as well as your area’s consumer protection agency to see whether there have been complaints.

People who file bankruptcy must first undergo counseling. Therefore, the United States Trustee Program maintains a list of approved credit counseling agencies. 

What Questions Should I Ask the Companies I’m Considering?

Once you’ve winnowed your candidates down to a few, you need answers to help you settle on a single agency.

Your questions should include:

• What are your services? You want an outfit that offers an array of services, including budget help and financial literacy classes. 
• How much are your services? If there are fees – there usually aren’t – you want to know details. For instance, are there monthly fees? You want a precise, written explanation of charges.
• What kind of info do you offer? What you don’t want is an organization that charges you for educational materials or related information.
• I’m broke. Can you still help? There are plenty of places that will help you even if you can’t afford to pay.
• Can you help me avoid future money problems? You’d like help beyond your current situation.
• Will you provide a contract? Get everything in writing, and as always, scour the fine print.
• Can you legitimately operate in my state? Scam agencies try to get around this, so make sure yours is licensed for where you live.
• Are the counselors qualified? Credit counselors are supposed to be able to handle consumer credit, budgeting, and debt management. Ask whether they’re trained by an exterior organization and how they’re trained.
• Is my information safe? You want to be sure that your private data remains just that: private. That goes for your phone number, address, and financial info.
• Are your employees paid by commission? You want to know whether there’s any extra compensation for them if you agree to certain services. If there is, that could be a sign that, when the rubber hits the road, they’d rather help themselves than, well, you.

Now that you know more about choosing a credit counselor, you can progress with confidence that you’ll soon be on the road to financial recovery.