Debt Consolidation

How To Compare Credit Counseling Services?

It is not at all fun to live paycheck to paycheck, especially when you are drowned in debts. When debt becomes too high to manage, people often look toward credit counseling services for help. However, considering the very fact that there are so many such companies available in the market and that many of them are scams, you have to be very careful with your selection. Following are some of the different aspects that you need to look into thoroughly in order to and to choose the one that is the absolute best for your specific situation.

The Cost Of Information

It is not wise at all to go with a company that charges a certain amount of money just to provide you a quote. When you request a quote, make sure you get it for free. Besides that, it has to be a no-obligation quote. Just receiving the information that how credit counseling services can help you out does not make you legally obligated to use the services. Furthermore, there is no need to provide private details, such as your social security number, just to get a quote. You must be wary of those counselors that ask you to provide such information.

Effects On Your Credit

You also need to figure out how your credit score will get affected if you use a specific that you are being offered. Ask the counselors to provide you the details on how the credit bureaus will be informed about the changes. Always remember, if your credit report shows that you are using credit counseling services, it will affect your FICO score adversely, which may make it further difficult for you to get consolidation loans or credit. So, the best company is the one that helps you regain control of your finances while making sure that such things are not reported to the credit bureaus.

Are There Multiple Options Available?

The services should not just be limited to debt management. The agency must be able to offer you an array of options so that you could make an informed choice. For example, besides educating you on how to manage your debts, the counselor must also be able to provide some valuable pieces of advice on budgeting and money management.

How The Creditors Are Going To Be Paid?

While you are comparing different credit counseling services, it is also important for you to find out how your creditors will be paid in case you choose to follow a specific program. Remember, your credit will become worse if your creditors do not receive their payments in a timely manner. Furthermore, your creditors may even cancel the debt management plan if they still miss their payments. So, you are advised to get it in writing from the agency what corrective actions they take to protect your interest in case the payment is not made on time.

Is The Payment Schedule Affordable?

You cannot accept just any debt management plan. You will have to look into the complete detail and find out if you can afford the payment schedule. It does not make any sense to sign up for a program that you cannot follow properly. If you still go for it, your situation will only become worse.

How Much Do The Services Cost?

The cost of the is obviously one of the most important things that you have to look into. The fees must be reasonable enough. You are already drowned in debts and the last thing you want in this situation is additional financial burden. As a general rule, you should wary of the agencies that charge more than 20% of the monthly payment for their services.

Last, but not the least, you must also find out if you are going to have an easy access to your accounts. Everything must be completely transparent. The agency must keep you updated with all the changes and developments that are taking place and how debts are being managed. The credit counseling services must provide you regular updates through Internet, mail, or phone.


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Posted in Credit Counseling, Debt Consolidation | 4 Comments »

4 Responses to “How To Compare Credit Counseling Services?”

  1. Season says:

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  2. Yagnaroopaya says:

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  4. Dennis says:

    The article is very informative and has a relevancy in today’s modern life. Every one is surrounded by multiple debts in today’s life. If you are also one of them, the article is must to read for you. Taking the help of credit counseling services is not a bad idea for getting rid off your debts. The selection of a genuine and reputable company is very important. There are so many unscrupulous companies are present in the market, that’s why it is very important to choose a company with a good past record. Any reputable company will not change you even a single penny for providing you the quotation and they will never ask you to mention private details like your social security number etc. The counseling agency should take care of your finances and it must not be reported to any of the three credit bureaus because it can give a bad effect on your credit score. The procedure of payment to your creditors should be clearly mentioned in the written agreement, because this is the most important part of the consolidation program that the creditors should get their money in time. The cost of services should be reasonable and procedures of the company must be transparent.

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