Nonprofit credit counseling assistance has been beneficial for consumers in need of aid when it comes to finding debt relief, but this subject is one that has many aspects which consumers must explore and, as a result, there are certain signs that individuals in need of credit counseling must look for before working with a particular counselor or service that will help formulate an affordable repayment plan for an individual’s situation. Credit counseling is usually the first step in a process that a consumer will take when they need help finding debt relief assistance, as a subsequent methods of debt relief like a debt repayment plan or debt settlement are typically not the first options that consumers need to explore, as a session with a credit counselor could help consumers find affordability to erase their debts and set future financial goals.
Yet, when it comes to finding and choosing a good credit counselor or a credit counseling service, many organizations need to meet a set of criteria that will either show they are a reputable organization and can provide helpful one on one service for their clients, as there are some institutions that may pose as a credit counseling organization but offer alternatives services, or some companies have simply been set in place as a way to take advantage of consumers who are in a difficult financial position. Understanding that credit counseling is greatly different from debt repayment and debt settlement should be a consumer’s first step as debt repayment will be an agreement between a creditor and a consumer for a structured plan that is usually implemented by a counseling organization and debt settlement is agreeing to pay off debts for less than the original amount that was owed, which could be detrimental to a consumer’s credit score.
Credit counseling from a nonprofit credit counseling agency is simply a session where consumers can present financial difficulties to their counselor, who will then review their income, expenses, and help formulate a budget and repayment plan that will simply be implemented by a consumer and not an official agreement with creditors. Some consumers may simply need help finding areas of waste in their financial life and setting up their budget in a way that allows them to both pay off what they owe and save for the future, but there are some conditions that consumers must require of their credit counseling organization to avoid a fraudulent company.
According to the Association of Independent Consumer Credit Counseling Agencies or the AICCCA, “Full disclosure is key to finding good quality credit counseling services,” and certain aspects that consumers must look for in a credit counseling organization is that they will be accredited by a third party, have certified counselors, our nonprofit, and are upfront about any fees that may be required of their clients. Obviously, consumers will want a counseling organization that will offer specific and comprehensive assistance particularly tailored for their financial situation and, again, offer full disclosure as to their policies and how they operate.
Consulting resources like the Better Business Bureau can also be beneficial for consumers looking for a nonprofit credit counseling agency, but there are also resources like Google that can be used by consumers to see if any negative feedback or fraudulent practices are associated with a particular organization they may be researching. However, before a credit counselor is helpful, consumers need to address issues early before their financial situation becomes too problematic, so finding a reputable organization to help generate solutions for a consumer’s particular problems is usually advised early on when financial troubles may arise, as subsequent options after credit counseling could be hurtful to a consumer’s credit score.