Do you feel overwhelmed by your debt situation?
This post originally appeared onReadyForZero.
Unfortunately, not all credit counselors act in your best interest.
It can be difficult to sift through information provided by companies promising to help consumers.
What should you look for when choosing a counselor?
And how can you tell if an organization exists to help others, not themselves?
What is Credit Counseling?
A credit counselor can help youmaintain a reasonable budgetand may help you establish a debt management plan.
Credit counseling isn’t a quick fix to a debt problem.
Instead, it’s a process you undergo to rebuild your credit and improve your financial standing.
Most legitimate credit counselors are nonprofit organizations.
Many legitimate companies also offer their initial consulting session with you free of charge.
Don’t hesitate to ask how they do charge for services or how they earn money to operate.
Walk away from companies that encourage you to leave a “voluntary” contribution in exchange for their services.
Again, the company should be a registered nonprofit.
Both organizations hold credit counseling companies to high standards of ethical behavior when working with consumers.
Additionally, the company should be accredited by a third party like the Council on Accreditation (COA).
What to Expect from a Credit Counseling Program
Most programs follow a process with three major steps.
First, a counselor will sit down with you for a comprehensive session.
Next, the counselor will help you develop a plan for repaying your debt.
Finally, any legitimate credit counseling program will provide you with financial education.
Although adebt management planmay be one of their services, it shouldn’t be the only one available.
(Not every consumer will need this level of assistance.)
If you cannot afford fees, reputable organizations should waive the cost.
Get quotes or prices in writing before working with any company.
Photos byImages Money,Marco Arment,CollegeDegrees360,reynermediaandDerek Bridges.
