Credit Counseling

Credit counseling providers are frequently non-profit agencies that help consumers deal with issues related to overwhelming debt. Credit counselors review monthly payment requirements and the money that is available to make the payments. They advise individuals on the best way to manage these finances to help pay off debt faster. This often includes educating the consumer on how to avoid incurring future debts that they cannot pay back. The agencies also negotiate with creditors to set up individual debt management plans.

Many creditors view the engagement of a credit counseling service as an important step in the right direction for consumers having difficulty in making their monthly payments. Selecting the right credit counseling service to meet your needs is important. Though most established agencies are non-profit, some companies are created that use a for-profit business model. As a result, they are more often interested in their own bottom line rather than the consumer’s.

If the credit counseling agency is self-accredited, their standards and policies may not be in place to protect the consumer. Independent third-party accreditation ensures business practices and procedures are designed with the consumer’s best interest in mind. Board of Director members should not be paid by the agency and should represent the community demographics. Many quality credit agencies offer a variety of services as their clients need help in many different areas. The fees charged by agencies may vary somewhat. However, no fees should be charged before services are provided.

Credit counseling agencies often do assist in helping you plan a repayment program but do not guarantee reduced interest rates or deferred penalty charges. Often consumers seeking to reduce their overall balance in order to make the debt more manageable turn to debt settlement for assistance. Debtmerica’s program has a track record of significantly reducing credit card debt through a 24-48 month program.