If you need help paying off debt, there are many companies out there that claim they can help you. Unfortunately, not all of them are reputable. You should be cautious of for-profit debt settlement companies, which could leave you even deeper in debt than you were before. A safe option is usually a nonprofit credit counseling agency. They have certified credit counselors who can help you find a way to get out of debt. How can these credit counselors help you? We’ll explain what a credit counselor does and how it can help you work towards a debt-free future!
What are credit counselors?
First, what exactly is a credit counselor? A credit counselor is a financial expert who can help you come up with a workable budget and a plan to pay off overwhelming amounts of debt. At a reputable credit counseling agency, the credit counselors should be independently certified and highly trained. They know the ins and outs of personal finance and consumer credit. When you call them, they will ask you about your income, assets, expenses, and liabilities. This gives them your overall financial picture so they can help you make a plan to pay off your debt and live a debt-free life in the future.
One way they are able to help you pay off your debt is by enrolling you in a debt management program. This program consolidates all your debts into one monthly payment. You pay the credit counseling agency, and from there, they disburse it to your creditors. They also negotiate with the creditors to give you lower interest rates and waive certain fees, like late or over-the-limit charges. This saves you money and makes it easier to manage your finances while you pay off your debt.
How can I tell if the credit counseling agency is reliable?
Credit counselors work for nonprofit credit counseling agencies, but sometimes it can be hard to tell what companies are reputable and which ones aren’t. Before you dive in and commit to a credit counseling agency to get help with your debt, it’s important to ensure that the agency checks certain boxes. How can you sort out the reliable credit counseling agencies from the scams? Make sure that the agency meets these standards:
- Nonprofit status
- Charges reasonable fees (no more than $50 a month for debt management)
- Should be licensed to do business in your state
- Member of a either the Financial Counseling Association of America (FCAA) or the National Foundation for Credit Counseling (NFCC)
- Should have been in business for at least 7-10 years
- Should be accredited by International Standards Organization (ISO) or by the Council on Accreditation (COA)
- Willing to waive fees if you can’t afford to pay them
- Credit counselors should be certified by an independent organization
Can credit counselors help me with other financial issues?
At ACCC, our credit counselors are approved by the Department of Justice to provide the mandated pre-filing bankruptcy counseling session that will analyze your current financial condition to enable you and your legal counsel to make well-informed decisions. We also have HUD-approved housing counselors who provide reverse mortgage counseling.
In addition to the different types of counseling we provide, ACCC (and most other reputable nonprofit credit counseling agencies) provide free financial education materials to the public. We provide budgeting worksheets, financial workshops in our community, and monthly webinars on various financial literacy topics. The goal of our credit counselors and ACCC as a whole is to ensure that our clients not only pay off their debt and whatever financial help they require, but that they also stay out of debt. We want to ensure everyone has access to financial education so that they don’t fall into the same habits that led to debt in the first place. Our goal is your financial well-being!
If you struggle to pay off debt, ACCC may be able to help. Call 800-769-3571 today to speak to a certified credit counselor.