Are Credit Counseling Services Any Good?
Posted on June 19, 2009 at 8:12 am
Does anyone know if these credit counseling services are any good or not? I have heard mixed reviews, what a surprise!
Posted on June 19, 2009 at 8:44 am
It depends how much debt you have, what your interest rates are and whether or not you are current or behind on your monthly payments.
If you make all of your payments on time, don't owe that much but are sick and tired of high rates then credit counseling may be a good fit for you.
In terms of answering your question in general, I think credit counseling services can be good for some people under certain circumstances and bad for others facing different circumstances. It is up to the agencies to underwrite and determine who is a good fit and who is not.
Posted on June 29, 2009 at 4:50 am
You've heard mixed reviews because just like a physical illness, debts and a person's financial situation is...case to case, or situational. The mixed reviews could also be because of the presence of credit counseling scam agencies and then there are those who, after counseling, enrolled in the debt management program, were unable to continue due to some personal reason, DROPPED OUT of the program, and rated it "useless" or a waste of money and time.
Posted on June 29, 2009 at 4:52 am
Credit counseling is always good whenever it is as a pre-bankruptcy requirement. Without it the petition is going to be dismissed.
Posted on July 5, 2009 at 10:19 am
Typically, credit counseling is good if the person doesn't owe too much, has no problem making monthly payments, but has high interest rates that are preventing them from paying the debt off over a reasonable amount of time.
Credit counseling agencies attempt to reduce a borrower's interest rates, and if successful, the person is able to pay off what they owe over a shorter period of time. Debt management plans tend to last 5 years on average.
Keep in mind that not all creditors work with credit counseling agencies, and the success rate of debt management programs isn't too high since missing one single payment (or being late) is grounds for termination from such a program.
Posted on July 6, 2009 at 4:50 am
how do i differentiate the good ones from the bad ones? there just seem to be so many, with all these guarantees and stuff. it's crazy
Posted on July 6, 2009 at 5:14 am
You've heard mixed reviews because just like a physical illness, debts and a person's financial situation is...case to case, or situational. The mixed reviews could also be because of the presence of credit counseling scam agencies and then there are those who, after counseling, enrolled in the debt management program, were unable to continue due to some personal reason, DROPPED OUT of the program, and rated it "useless" or a waste of money and time.
Posted on July 6, 2009 at 5:26 am
Accreditation is key. Regulating agencies after all have stringent standards with regard to running their businesses and dealing with customers. It would be best to work with a company that has few complaints with the Better Business Bureau. You may check out how the company fares with the Bureau at http://www.bbb.org.
It also helps if they are affiliated with the National Foundation for Credit Counseling, and they can be found at http://www.nfcc.org.
If you'll be working with a non-profit company, see to it that they are a (501)(c) accredited organization.
Posted on July 6, 2009 at 6:34 am
How much debt should i have in order to qualify? i wonder if $2000k is good
Posted on July 6, 2009 at 6:44 am
that's good enough. others even accept hundred-dollar debt amounts. the service is non-profit anyway and won't require much. that is if the company is legit of course
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