What is Credit Counseling?
Credit counseling is a process that is used to help individual debtors with debt management through education, budgeting and the use of a variety of tools including debt management plans, with the goal of reducing and ultimately eliminating their debt.
What does a Credit Counseling Agency Do?
Credit counseling agencies provide education and assistance to consumers who have more debt than they feel they can repay on their own. Credit Counselors provide concessions from the creditor to reduce or eliminate interest charges and stop late and over-limit fees. If they are nonprofit (as we are), they will also provide free educational materials and or courses on basic money management as well.
Who Should Consider Talking to a Credit Counselor?
Credit counseling is appropriate for individuals who are trying to pay off their debt but who don’t feel they are making any headway on their own. They may also be people who have high-interest rates on their credit cards, who may have taken out a payday loan, and/or who may be late on any such debts. Credit counselors may not be able to help you with the renegotiation of a mortgage, car loan, or other secured debt. For help with your mortgage, see a HUD-certified counselor.