FAQ on credit counseling and debt management – Some questions answered

If you’re drowning in credit card debt, you’re not alone. In the United States of America there are millions of people who owe a huge amount on their multiple credit cards and who are seeking for professional help. Asking for help from the professional companies have never been a respectable task but with the soaring debt level in the US, an increasingly large number of people are shedding off all inhibitions and are rushing to the credit counseling firms that have experts who provide customized financial help to people. There are many people who are ready to take help from such companies but they have too many doubts about this entire system. If you too are going through the same doubts, the concerns of this article may help you out. –

*What services do the credit counseling agencies provide?*

The debtors are habituated with the general heading “debt counseling” and “credit counseling” but they aren’t aware of the responsibilities that credit counseling entails. There are major responsibilities of a credit counselor but there is a slight difference between a ‘credit counselor’ and a ‘debt counselor’. ‘Credit counselors’ only do counseling and debt education and the ‘debt counselors’ deal with effective negotiation with your creditors and signing up the debtors with the debt management programs. –

*Can the credit counseling agencies meet the law requirements of the state?*

Since 2005, the law in the US requires anyone filing bankruptcy to attend a compulsory credit counseling session so that he may know whether or not it is actually necessary to file bankruptcy. Someone who is about to file Chapter 13 or Chapter 7 bankruptcy should complete an instructional course in personal finance management before his debts are discharged. The aim of the law is to make the debtor aware of his situation so that he is at least informed before filing bankruptcy. –

*By whom are the credit counseling agencies accredited or registered?*

Before you take the plunge into credit counseling, you should ensure that the credit counseling agency that you’re taking help of is authentic. Most debtors aren’t aware of the ways in which you can check the authenticity of a company. Ask the credit counselor about their accreditation. Any trustworthy firm that offers reliable services will be accredited by the Better Business Bureau and the National Foundation for Credit Counseling or the NFCC. –

*Are the credit counselors certified and trained?*

When a debtor seeks help of an outside organization, it should always cross-check the authenticity of the company and unless and until to take resort to a counselor that is trained enough to offer you the services, you won’t get the assurance of a debt free life. Look for professional credentials and relevant educational background. Verify if the financial planners are Certified Public Accountants or Certified Financial Planners. –

*How will this debt solution affect your credit rating?*

Nowadays as the lending industry is entirely dependent on credit, most debtors are worried about the impact of any debt solution on their credit rating. This is a realistic question that you should ask your counselor while getting help. As you’ll not be repaying your debt according to the credit card agreement, this will certainly affect your credit score slightly but as soon as you start making the payments through the debt management program, you can boost your credit score again. So, if you’re spending sleepless nights wondering about how to repay your debts, get help from a credit counseling agency after checking its authenticity. Manage your finances and pay back on time in order to get out of debt.


Sophia Garfield is a financial writer, she writes articles on credit card debt,credit card consolidation, credit repair, credit counseling etc. If you want to get some quality information on credit counseling then you may visit here: http://www.debtconsolidationcare.com/credit-counseling.html

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