Debt Counseling
December 3, 2007
Debt counseling may seem like a drastic step to take when attempting to get a handle on your finances, however, it certainly is a better alternative than filing for bankruptcy.
With a personal topic such as your finances, you will want to ensure that you employ the use of a debt-counseling agency that fits your financial needs.
A reputable agency will not require a large fee in order to get started. As a rule, you should not be asked to out put over $75, with a counseling fee of about $50.
This should be a no pressure situation, if at any point you begin to feel pressured to commit to a plan that you know is unaffordable, thank them for their time and look for another agency.
A knowledgeable debt-counseling agency will work with you to create a spending plan that will allow you to get a better picture of how much money you can afford to pay, once a debt repayment plan is devised.
If an agency promises they can help you after spending less than half an hour with you, it is recommended that you seek out an agency better suited to meet your needs.
A great advantage to debt counseling is it provides you the opportunity to repay your debt without the negative repercussions of a write-off (also known as a charge off),
Debt counseling allows the creditor to receive a majority of what is owed. That is why many creditors are willing to negotiate with a debt-counseling agency to reduce interest rate and waive fees.
It is important to realize that once you enter into a debt repayment plan via a debt-counseling agency, all of your credit accounts will be closed. In addition, it is at the creditor’s discretion on how they choose to report this course of action to the credit bureaus.
You should also request a detailed evaluation of your financial status, to ensure a successful debt repayment plan. In addition, request in writing how to address disputes that may arise with creditor while under your new debt repayment plan.
Finally, make sure all of your questions have been answered to your satisfaction before deciding on any particular credit-counseling agency.
