Details for Personal Debt Counseling
You’re knee deep indebted. You’ve tried budgeting, talking to your creditors and also other self-help methods of controlling your debt, and it just hasn’t done a bit of good. Don’t throw in the towel! Don’t freak out! Give credit guidance or debt management a try before you think about bankruptcy options.
What is Credit Counseling?
Reputable consumer credit counseling services will perform these tasks:
- Advise you on managing your money and debt
- Help you develop a budget
- Offer free educational materials and workshops
Credit counselors are certified and capable in the instances of credit score, money and managing debt and budgeting. Counselors will discuss your complete finances and will help you create a personalized plan to solve money problems.
Choosing a Credit Counseling Organization
Most credit counselors offer their services through local offices, the net or on the telephone. Whenever possible, you must seek the one that offers in-person counseling. You must develop a listing of reputable consumer credit counseling organizations and ask that they provide you free information brochures about their services. The following organizations often offer credit counseling services:
- Colleges and universities
- Military bases
- Credit unions
- Housing authorities
- County or cooperative extension services
Your bank, local consumer protection agency, church, loved ones can be a useful source of information and referrals. The US (Bankruptcy) Trustee Program has a list of approved credit counseling agencies in your area. Each state’s Attorney General’s office, local consumer protection agency and Better Business Bureau can give a list of any complaints filed against the agencies on your list.
Be wary! Many credit counseling organizations are nonprofitand give their services totally free or for a modest fee. However, you will find for-profit credit counselors that could charge an expensive fee and others that could bill themselves as “nonprofit” and “free” but require you make an upfront “donation” or “voluntary” contribution.
Questions to Ask
After you’ve narrowed your list of credit counseling agencies, contact your final candidates and ask:
- What services do you provide? You want budget counseling and debt management classes, not debt management plans discussed below
- Will you help me avoid debt problems in the future?
- What are your fees? Are there any upfront or monthly fees? Get it in writing
- What if I can’t afford your fees?
- Will I have a formal written agreement or contract with you? Always read what you sign
- Are you licensed by the state?
- What are your counselors’ qualifications? Are they accredited or certified by an outside organization? If so, by whom? If not, how are they trained? Avoid agencies that train or certify their own counselors
- How will you keep my personal information private?
- How do you compensate your employees? Avoid any agency that pays their employees based on whether they sign you up, pay a fee or make a contribution
Debt Negotiation Programs
Stay clear of credit counseling agencies that promote debt negotiation services! They’re extremely risky and may have a negative impact on your credit report. Many claim to be nonprofit organizations and:
- Guarantee that they can reduce or remove your unsecured debt
- Require substantial monthly fees
- Demand payment of a percentage of savings
- Tell you to stop making payments or communicating with creditors
- Require you to make monthly payments to them, rather than to your creditors
- Claim creditors won’t sue you for nonpayment of unsecured debt
- Promise that using their system won’t have negative impact on your credit report
- Claim that they can remove accurate negative information from your credit report
For help with a Macon GA chapter 7 bankruptcy, select a bankruptcy attorney Macon Georgia. A Macon Georgia bankruptcy law firm could give you the help you need.
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