Credit Counseling

So who needs credit counseling? Anybody whose debt loads are running high and who are thinking of filing bankruptcy, need counseling with their finances. Counseling services are meant to negotiate with your creditor for lower payments. More and more counseling on credit services are seen as they are encouraged by the payment system that is called the ‘fair share’.

If you are able to handle your finances well and pay your bills in time you are one amongst those who don’t need counseling. But if you see your bills mounting and you are panic stricken with too much debt to handle, you can seek help from a debt counselor. There are tell-tale signs to understand when you need counseling. They are:

o When all that you think you can afford to pay is the minimums on your credit.
o You have been late with your payments on one or more of your bills.
o Collection agencies or creditors are pestering you to pay up.
o You have not been able to negotiate with your creditors for an affordable payment plan.

If your debt is too much to handle credit counseling might not help either. How much your creditor will compromise is also bound by limits. Your creditor may not be able to cut down your payments to a great limit. Make sure that you don’t stretch your payments for years. This will only result in you paying up a much larger sum of money over a long number of years. You can seek help from Christian credit counselors if you are looking for non-profit counseling of credit services.

What to do after deciding on credit counseling? When you have decided that you will opt for credit counseling, you must have certain things in mind:

o Find out if you are paying more for counseling services then you may be tricked. A service charge is usually $10 set-up fee.

o Look for an accreditation to the National Foundation for Credit Counseling or the Association of Independent Consumer Credit Counseling Agencies. Legitimate counseling firms are usually affiliated to these associations.

o Check if the money is going to the right place. Some companies put the first month’s payments as their fee instead of giving it to your creditor.

o If a company is making unrealistic promises then beware! A legitimate credit counseling service will help you pay back your money and negotiate a lower rate of interest and till you that this might have some affect on your credit report.

Only a legitimate credit counselor can offer you a good service. Others will promise good service but will ultimately take away your money and leave you more in debt. So choose your debt counselors carefully.