Debt Counselors

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What to Look for in Debt Counselors

The amount of debt that the average person has is unbelievable. The ability to buy things on credit in our society allows people to buy things that they may not be able to pay for later. Circumstances change and making minimum payments on accounts will take you years to pay off. One solution to help you get your finances under control is to find out what debt counselors have to offer.

A debt counselor is an individual who is knowledgeable in the areas of finance. They will sit down with you and evaluate your individual situation. Look for an agency that offers a free consultation such as Debt Counselors of America. Bring all of your bills as well as information regarding your income. It is important to be honest with debt counselors so they can provide you with realistic options that may work for your situation.

Many debt counselors encourage you to enroll in budgeting and debt management courses if you decide to work with their agency. This is to prevent you from getting yourself into the same situation down the road. Debt counselors may be able to get your creditors to settle for less money than what you owe them. At the very least they can get late fees to stop as well as get you a lower interest rate. Debt counselors are able to negotiate terms that you won't be able to on your own.

Many people are skeptical about debt counselors because they have gotten some bad publicity in the past. While most debt counselors work for reputable agencies, there are a few out there that have caused people to end up in worse circumstances than they were before. It is important to check out the reputation of debt counselors and the programs they work for with the Better Business Bureau.

Other people are embarrassed to talk with debt counselors because of the situation they have gotten themselves into. Debt counselors are professionals who are attempting to help you. They aren't going to judge your decisions but they will work hard to help you identify ways to prevent them from being repeated. If you don't feel comfortable talking to debt counselors during your consultation, you may want to look for another agency to work with.

Debt counselors can't repair your credit report or prevent creditors from reporting information to them. However, working with debt counselors can help you get your finances back on track. In the long run, this means your credit will be better off than if you continue to be late on payments or you have to file for bankruptcy.

Before you commit to working with any debt counselors, find out about their fees for the service. Many of them work for non-profit agencies but there is still a monthly fee assessed for services. You also want to find out how they will be sending money to your creditors because you will pay them one payment to cover all of those creditors. You should get a monthly statement from them as well as continue to get one from each of your creditors on a monthly basis.