Credit counseling : Chose a legitimate agency and save thousands of dollars
Credit counseling : Chose a legitimate agency and save thousands of dollars
First what is credit counseling definition? It is a debt relief technique. It allows you to talk with talk with a counselor. You will talk about your financial situation and how to improve it.
If you're in a very difficult financial situation you will give him details and he'll create a repayment plan that he will send to your lenders. The creditors will have to approve the plan. If they approve, it will lower the interest and the monthly payments. Most creditors will approve a good plan because they know it's a lot easier to get their money back that way.
The interesting thing about this debt relief technique is that you can go see a counsellor even if you're not in a difficult financial situation yet. The best technique to avoid debt is to seek advices from professionals. So if you're not in debt right now but you think you could be soon don't hesitate to go to a credit counselling agency.
You can also consult a counsellor if you're in a debt relief program but you're not sure if you have done the right choice. You can ask him or her questions about your financial situation and if they think the company you hired made some good negotiations with your creditors.
Before you choose a credit counselling agency, always remember that there are a lot of scammers and bad companies. Some companies are not legitimate and will try to get as much money from you as possible. They will use some common techniques.
That's why you always need to check if your creditors have accepted the plan. Scammers will tell you that they negotiated a plan while, in fact, they did nothing. Remember that most scammers will not even contact your creditors. That's an easy way to spot them.
There are also companies who will negotiate for you but will charge you too much. The rule is simple. Don't pay more than approximately 20% of you monthly payment. Credit counselling agencies usually receive a percentage of your monthly payments. That's the reason why they don't need to charge a large fee.
There a lot of other techniques scammers are using. To avoid them always remember to check if the company is legitimate or not. You can also talk to your family and friends about the firm you want to contact. Maybe they know if the company is legitimate or not.