Can a Non Profit Credit Counseling Agency Help You?

Getting out of debt is a lot harder than getting into debt-just ask any one of the millions of people who used the services of a non-profit credit counseling agency in the past year alone. That’s right-over eight million people in the US signed up with one of these agencies because they were drowning in debt and didn’t know what to do to help themselves. So, if you are facing this problem, you certainly are not alone. Considering the way the economic situation is leaning now, you will have plenty of company should you decide you need the help of an agency. There are several ways a non-profit credit counseling agency can help you resolve your debt problems. First of all, the initial service where a trained counselor reviews the statistics of your case is usually free of charge. Of course, there are a few reputable agencies that do charge a small initial consultation fee, but even so, this is a very reasonable amount. The counselor will ask you questions to determine how best to help you, and take a look at your financial situation. This initial visit may last over one hour simply because he or she needs to get a full picture of your overall debt situation before proceeding. The non-profit credit counselors will need a list of all your debts, as well as a statement of earnings. They will carefully go over the debt statements to see how high the interest rates are, how much you owe in total, and whether or not fees are being charged if you pay late or go over your pre-set credit limit. These charges can add up to a substantial amount over time, and are another waste of good money. After a thorough examination of your financial status, the credit counselor can then discuss what options would work best for you to get out of debt. In some cases you may be able to manage your debts by being extremely careful and keeping a close eye on every cent you spend over a period of time. Many times, a budget can be created that will allow you to begin paying down your debt on your own. It will only work if you are agreeable to sticking to a strict non-spending plan-that is, limiting your expenditures to your bills and absolute necessities. Some people find this very hard to adhere to, however. They may start out with every intention of following the budget, but slip up along the way. The credit counselor will work with you on certain non-secured debts like credit cards, but your mortgage and car payment must be kept current to avoid losing either one. They will assist you with methods that will help you keep these debts current. The goal of the non-profit credit counseling agency is to teach you how to avoid the pitfalls of credit problems, and at the same time assist you with certain debts by working with your creditors to get interest rates lowered. At the same time they want to make sure you also have enough money to pay your utilities, buy food for your family and keep a roof over your head. Take their suggestions seriously, and make every effort to follow the plan the counselor sets up for you if you want to get out from under the heavy load of financial obligations. Your credit counselor will also be perfectly honest with you if there is no way they will be able to help you by budgeting alone. There may be times he or she will recommend a Debt Management Plan if there is no other alternative. This will allow you to be able to get out of debt in a shorter period of time, usually three to six years. They will work with the creditors to obtain lower interest rates for you, set up a repayment plan that they will distribute monthly, and also stop all your credit card accounts. An honest, reputable non-profit credit counseling agency will not turn you away if you cannot afford the modest fee they charge to assist you. Getting free from debt may seem like a long and arduous process, but the end result will be worth everything you had to do to be financially free.