Hiring Payday Debt Consolidation Counselor – 6 Very Useful Tips
If you are caught in a very tough financial situation, where you owe a cialis canadian pharmacy large amount of payday debt to various lenders and you do not have an idea how to arrange money to get rid of your debt problems, the services of a payday debt consolidation counselor can prove to be very helpful for you. But, there are several important factors that you must take into your careful consideration in this regard. The good news is that it is very easy to find such counselors; your choices abound. But, it is also important for you to keep in mind that not all of them are legitimate ones, and not all legitimate counselors make the best choice for you. You will have to be very careful with your decision. Following is a brief rundown on ten tips that you will find very useful in this regard.
Decide About The Types Of Services That Make The Right Fit For You
When it comes to hiring a payday debt consolidation counselor, the first thing you have to do is to research your specific requirements and decide about the right types of counseling services you need. Though there is a wide array of services that payday debt counseling covers, there are two major categories – first, debt negotiation and reduction, and second, education and counseling. Though the main task of a counselor is to review your finances and then educate you on how to improve your situation, many counselors these days are also offering various other types of debt relief services, such as debt negotiation, debt consolidation and debt settlement. They charge a higher sum of money for debt relief services. When it comes to dealing with payday debts, you probably need a counselor who can negotiate the debts with your lenders on your behalf and convince them to offer you an affordable repayment plan. Besides that, your counselor must also educate on how to regain control of your finances and save enough money to ensure repayment of your payday debts.
Awareness Of The Payday Loan Laws Of Your State
You are strongly recommended to hire a payday debt consolidation counselor who is also well aware of the legal provisions imposed by the payday loan laws applicable in your state. This is very important because payday lenders are notorious for their illegal practices. There are thousands of such instances. For example, there are lenders who are issuing loans to consumers residing in states where payday lending is banned; this is illegal. If you are living in such a state and have still been issued a payday cash advance, you are legally obligated to pay back only the principal amount without any interest or penalty charges. Besides that, you also have the right to file a lawsuit against them for these illegal activities and the mental and financial torture thus caused to you. Likewise, the states, where payday lending is legal, have imposed certain legal restrictions on lenders, such as the maximum amount of loan that they can issue to an individual borrower, the maximum interest rate and fees that they can charge, the minimum and maximum repayment period, whether the rollovers are permitted or not how many times), the maximum limit on collection charges and an array of other such things. Many states have even made it mandatory for these lenders to offer an easy repayment plan to those borrowers who are not financially able enough to repay the loan. Unless your counselor is well aware of all these laws, they will never be able to provide you the best solution to your mounting payday debt problems.
Check Whether The Counselor Is Duly Licensed
It is also very important for you to understand that even a payday debt consolidation counselor has to meet certain legal requirements. For example, they must be duly licensed to offer their services in your state.
Check Their Accreditation
It is always safer to sign up with a counselor who is also accredited with the Better Business Bureau (BBB) as well as the National Foundation for Credit Counseling (NFCC). Though accreditation to these organizations is not a legal requirement, it ensures that the counselor you are hiring is a legitimate one. In fact, you can even check their past records maintained by these organizations. A thorough background check will help you get a very practical idea on the quality of services they offer, how much fees they charge and whether there has been consumer complaints against them. A payday debt consolidation counselor who has lots of unsolved consumer complaints against them obviously never makes the right choice for you; such counselors should be on your ‘to-avoid’ list.
Check Their Non-Profit Status (If They Claim So)
Many counseling agencies claim to be working as non-profit organization, but not all of them are genuine. A legitimate nonprofit agency must always be listed in the under Section 501(c)(3) of the IRS code. Make sure you check their non-profit status thoroughly. Besides that, it is also very important for you to keep in mind that just because the counselor is working for a non-profit organization, it does not necessarily mean that they offer free services. In most cases, you will still have to pay a certain amount of fee to them. But yes, if it is a reputable agency, you can expect them to charge you less as compared to the fees charged by other ‘for-profit’ counselors.
Effects On Your Credit Score
One of the most important things that you must consider before hiring a payday debt consolidation counselor is how their services are going to affect your credit score. In most cases, it can have a very serious negative impact on your credit, but there are also ways to protect and in fact to improve your credit situation by using counseling services. Whether the effect is going to be negative or positive will depend entirely on how it is reported to the three major credit bureaus (TransUnion, Equifax and Experian). For example, if your counselor negotiates with your lender and convince them to report your debt payments as ‘paid in full’, it will actually improve your score. But, if the lenders report your debt payments as ‘paid partly as per a negotiated deal’, it will cause serious damage to your credit. Therefore, you should focus on hiring a counselor who is an expert negotiator.
Overall, if you keep in mind the above things and do a thorough comparison shopping, you will definitely be able to choose the best payday debt consolidation counselor.
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