What is Credit Counseling?
Credit counseling is a partial solution to your financial troubles. I understand the need to use counseling you can trust to solve your troubles.
Credit counseling is considered a partial solution because it does not reduce your financial troubles. Rather, it focuses on why you have arrived in debt and what you can do to reduce those burdens and stay out of trouble in the future. The thing is, if you do not know why you overspend or cannot stop the overspending it will be difficult to end your debt cycle. Debt counseling is designed to ensure you get out of financial trouble forever.
Credit Counseling to Provide Debt Relief
Credit counseling is going to focus on offering you debt relief. You will have to find out what makes you overspend or spend more than your income. Perhaps you have no income. In this case counseling is going to focus on helping you spend any savings or unemployment you receive without overspending it and getting further into debt. You may have a different problem. You have plenty of income, but you overspend constantly which means what income you make is no longer covering your burdens. In this case counseling is going to focus on why you feel the need to overspend.
Typically, when you go to credit counseling you are asked to explain your situation. You will need to show what expenses you have for the month, what incidentals might occur, and what the totals are that you owe on things like mortgages. You also have to provide the amount of income you have. All of this information is used for counseling. The counselor is going to look at this information to see if you overspend in any particular area or if you can reduce your spending in certain areas like restaurants. In this way debt consultation has the full picture and can target your issues.
Choosing a credit counseling agency correctly is imperative. If you go to the wrong company there is a chance that you might be scammed. This is where I come in. I have spent many years researching different companies whether they offer counseling, debt management, settlement, or negotiation. I study a company, vet them against high standards I have devised, and then review them for you. In this way you know you can trust any of the companies I have named for credit counseling services.
Even though I might vet a company that offers counseling, these companies may not work for you. It is based on your situation. More importantly, you have to be able to work with the person offering you the counseling. If you are not comfortable with the person meant to help you it will cause trouble for your situation. Obviously, if you cannot talk about your financial troubles with the counselor it will make the credit counseling ineffective and often you will feel you have wasted time undergoing the process.
Credit counseling is only one solution to the situation as a whole. We mentioned it is a part of the larger picture. This is due to the need for you to actually get rid of the financial burden you have. You need to pay down those credit cards and loans. Counseling focuses on why you have the high balances. Now you need an option that will help you like management, settlement or consolidation, where you focus on paying off the money owed whether it is through a negotiation to a settlement, consolidation loan, or a management plan devised during your credit counseling talks.
Top Companies for Credit Counseling
National Debt Relief is the first. This company offers you help in a number of ways such as credit counseling, negotiation, settlement, and consolidation loans. They work to settle all of the financial burden at once rather than working with one creditor at a time to eliminate your financial obligations. They have been around since 2002, but let their testimonials and my review convince you about their merits.
National Debt Relief has professional staff and a committed customer care desk which will put you through to an expert if you opt to call them on the phone. Their website is easy to navigate and has relevant information relating to debts and how they should be managed. To be assured of their competence, the company has several positive reviews and testimonials from people who used their services in the past. In addition, people who feel that they need some kind of assurance will feel at peace with the knowledge that National Debt Relief has a high ranking in the better business bureau. Just call them today on their free toll number to begin your road to debt recovery.
To go through the entire process quickly and without having to endure a lot of pressure, a company like National Debt Relief would be ideal. Recently, the conducted a survey which concluded that their clients were 93% satisfied by the solutions they offered. Considering the stress one goes through when they have a pressuring debt, some customers acknowledged that National Debt Relief exceeded their expectations by far after trying out the suggested solutions.
The next company CuraDebt provides a lot of information and facts and offering you a solution to your monetary troubles. It still has counselors to help you, though. In fact their main focus is more on credit counseling, enabling you to get the help you need before you try to pay down any of your monetary balances. This site often provides you with information, articles, and the credit counseling you need to solve your financial troubles.
Irrespective of the company you select, credit counseling should be free of charge. A fee may come up at some point, but this should not be until you decide on a debt settlement. Even CuraDebt will ask for fees if you reach a debt settlement but nothing should be charged for the credit counseling you received. With this in mind, decide beforehand if you need a debt settlement to save the situation. The main reason why these companies charge fees for debt settlements is because they pay to negotiate with your creditors. Let the testimonials and my intimate review of this debt company help you see the virtues of this company.
Oak View Law Group is another credit counseling company I have reviewed. They focus mainly on credit card companies; however, they can also help you reduce loans. My review shows this is a strong company for settlement, negotiation, and consolidation loans. They often work with credit card troubles individuals have. If you need specific debt help with credit cards consider this a top choice given their specialty area.
Oak View Law Group the will offer you appropriate information based on your financial situation and later help you solve the debt problems you are currently facing. If you need their services, you can either get them online by visiting their website or one of their several offices in the country. Oak View Law Group offers you free and no obligation credit counseling which implies that you can converse with an expert without necessarily having to sign any documents or make any payment.
The above three companies are just a few of the debt programs available to you. Many of these companies also work with Canadian citizens in the event you are not in the USA. I have worked with a number of these credit counseling companies. I have even met representatives of the company, so I know their faces. It helps to read reviews about individuals you know the reviewer has met. It is even better when you know the recommendations come from experience and high standards. It is important that you solve your financial burdens with a method you can trust. I hope my credit counseling reviews can help you find the company you need.
Reduction of any monetary burden you have will make your life a lot simpler in terms of your income. You may find that your income is actually quite sufficient once you are out of financial trouble. Of course, it all depends on what you make and what you spend. Our moods can certainly determine what we spend. When we are tired of living a boring life to save money we can splurge. This is why going to credit counseling can help you figure out what causes the splurge, overspending and overall issues.
Credit Counseling to Examine your Finances
When do you use debt counseling? Must you use financial counseling if you want to go through a bankruptcy? What is the overall purpose of financial counseling? These are the three main questions I see a lot when it comes to the concept of counseling for financial improvement. Given the frequency with which I see these questions it is important that the answers be explained in detail to help you better understand what can sometimes and often is misconstrued.
Financial counseling exists for anyone who would like to get a second opinion on their expenses and income. This counseling option is not specific to individuals that are suffering from too much debt or those who may be filing for bankruptcy soon. Anyone can take advantage of financial counseling. There are plenty of government offices that provide pro-bono work. These not for profit agencies will have you outline all of your expenses, income, and retirement accounts. This includes any incidentals you may have throughout the year. You will have to look at what you owe, what income comes in, what you pay out in a year and what you pay out each month.Getting Financial Assistance
The plan examines everything including what you spend on groceries, gas, and eating out. Credit counseling can then take the information to work up a debt management plan whether it means getting financial assistance like a debt settlement or just determining how you can start to lower your bills.
With counseling you may find that you eat out with $400 every month and you spend twice that in groceries. As you reflect on the expense of $1200 for food you realize you have four people in your family, and there are ways to reduce how much you eat out or at least how much you spend total on food because you tend to throw out too many groceries some months when you dine out more. The point is that sometimes we spend more than we need to because it gets thrown out or we may not have really needed something that we bought. Counselors look for these things to help you streamline your expenses. Even if you are not in debt or a financial squeeze you could be saving income rather than wasting it, which is why you might seek counseling even when you are not facing bankruptcy or judgments against you.
For those that have to seek bankruptcy because they waited too long to start gaining control of their expenses or because of a lost job or other issue they will have to use debt counseling first. In 2007 when the economy started to fail the bankruptcy laws were changed. Anyone who wanted to go through bankruptcy would first have to go through financial counseling. It is a means of deterrent. If someone is educated in how their spending habits create a debt situation then they may not be in a situation of going through bankruptcy again and thus counseling is designed to help as a beginning debt relief solution.
Credit Counseling Helps put your Finances in Perspective
What are your finances like? Do you keep every receipt in a box or do you file them? Do you watch every penny you spend or look at your bank account balance and hoping for the best? The type of person you are with your finances can determine how helpful credit counseling will be for you. If there is just not enough income to pay the expenses you have, then you have to eliminate as many as possible. It might mean cutting back and having to stop your cable or satellite TV. The good news is that you have internet. Most of us cannot live without internet for our jobs and financial situation. Paying bills via internet saves money in terms of stamps and it saves time too. So eliminating TV, obtaining an antenna for local stations, and using internet for all other shows is a good idea.
Now, just because you eliminate everything doesn’t mean you have gained perspective yet. Unless you look at the situation in black and white, your financial situation will not get better. You may know what you can cut out of your spending like not buying ice cream, purchasing the cheapest paper towels, etc; however, until you look at a piece of paper that lists all expenses, debts, and income you won’t have the perspective you really need. Credit counseling can give you this perspective.Examine These Two Options
You have two options: non-profit and for profit businesses. A non-profit organization is usually one that is part of the local government. They work closely with bankruptcy lawyers and government grant agencies. They also do not require you to pay for the counseling you receive. Credit counseling via a for-profit organization can open you up to scams, unless you do your research. Examine these businesses to see if there are any complaints about them. If there are no complaints then you can probably trust them, but also check the fee amount they might want. Some places might ask for less.
Once you find a company you can trust, it is time to look at your financial situation objectively. You cannot get emotional as this can lead to more trouble. It is one of the reasons credit counseling is available. Counselors can help teach you how to ignore your emotions and look at the financial troubles you have. They will look at all of your expenses, debt, and income to determine where you sit in terms of financial pain.
From this a solution can be determined. You might be told that a management plan where you pay a monthly payment to a consolidator is the best option. If you have savings you might be able to reduce what you owe and get back on track to pay the debts down yourself. You may obtain an equity loan to consolidate all your debts. Credit counseling will help you see which debt relief solution is best for your situation. It is a personal arrangement to help ease the disaster your finances might be in.
Manage Your Debt with Credit Counseling
Debt is one of the most stressful problems for most people in the world today. However, the larger population of those who live in debt is to blame for their financial problems; statistics show that most debts are as a result of unwise use of credit cards. To learn your mistakes and take effective measures which will prevent your situation from getting worse, it would be worthwhile to consider credit counseling.
In simple terms, credit counseling involves the creation of a debt management plan which is an agreement made by a debtor and a creditor to settle existing dues. Credit counseling may also involve education where an individual learns how to manage their money in a wise manner and hence prevent debt problems from recurring in the future. Below are some of the benefits you gain.
Negotiations made through credit counseling can see a credit card company lower their interest rates by up to 10% after the debt management plan is drawn. Depending on how much you owe, some companies might even decide to pull back the interest rates with anticipations that it will be easier for you offset the debt in a shorter period of time. Remember, some credit card companies have interest rates as high as 30% which makes it difficult for their clients to pay back. Reducing it by 5 or 10% implies that you will pay less each month which not only lightens your burden but motivates you to clear the debt in the shortest time possible.
As much as you want to be free from debt, creditors are also in need of their money which is one reason why they are willing to lower your monthly payments. Most of the times, such a strategy will be enforced through debt consolidation where a series of monthly payments are added up into a single monthly sum. This will certainly increase the recompense but if spread out through the year, is usually less than what you used to pay in the past.
The Benefits of Credit Counseling
A good credit history is a necessity where one needs to apply for a loan, a job or even a mortgage. Incapability to pay your debts in good time has adverse effects to your credit history although you can clean up the record if you considered credit counseling. For one, a debt management plan will be created after which you will be required to stick to it. If you continue paying your debts in a timely fashion for a stipulated period of time, eventually you will have a good credit history.
You can draft a debt management plan with your creditor and agree upon a contract to eliminate the debt but it does not help if you continue with the same old habits which landed you into problems. Credit counseling prevents this by giving you a chance to meet debt counselors who will help you adopt a new financial life. To be precise, debt counselors teach you how to better manage your money by enforcing strategies such as budgeting. In addition, they will provide beneficial advice on the possible methods you could use to regain financial stability. With the right tutor, anyone riddled in debt can get back on their legs and upgrade their living standards.