When Do You Need Credit Counseling Services?

2007-03-08 10:33:40

( Financial )



You may be surprised to find out that a lot of people are now turning to credit card counseling to relieve them from debt. Before jumping on the bandwagon, however, make sure you have done your research as credit counseling services are not always helpful.

Credit counseling services are services offered by an agency. The agency provides general advice for budgeting, money management and even debt repayment. Once you have your own credit counselor, your counselor talks to your creditors about eliminating the late fees your have incurred and even lowering your current interest rate. Then you pay your counselor a fixed amount monthly and they will be the ones to settle with your bank or lending institution.

When choosing a credit counseling agency, it is good to choose the ones that are active members of at least one of their major credit counseling associations. You can be assured that the agency has gone through a rigorous accreditation process and their operating practices have been fully reviewed by the association. You may also want to check your local phone book so you will have an idea which agencies are located near you.

Once you have narrowed down your list, a personal visit to each agency may be necessary. You may want to ask what credit counseling services their agency provides and if there are any fees that you need to pay. Talk to your potential credit counselor. Keep in mind that this counselor will be entrusting this particular person with confidential financial information. You want a credit counselor that you are comfortable with.

After you have spoken to several credit counseling agencies, you may decide between using the agency or you can decide going through it alone. In all honesty, you can do anything your credit counselor can. But you should be honest with yourself and you should admit if you need the help of a credit counselor.


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