Should you get credit counselling?

Credit counselling is obviously one of the major alternatives to help people get out of debt. A lot of people may wonder whether it’s worth the money. Here is a little information about how credit counsellors work.

Credit counsellors are just middle men, right?

Technically, yes. You can definitely do their job yourself if you want.

What exactly do they do?

They work with your creditors on getting better payment terms. They might do this by either lengthening the amount of time you have to pay off the loan, reducing the interest rate, or even lowering the grand total.

In most instances they deal with credit card debt, since this is what most people deal with. But before you hire anybody, you should at least attempt to negotiate with your creditors prior to hiring a third party to do it for you. It can’t hurt, after all.

When should you get a debt relief counsellor?

If you are barely able to cover your minimum credit card payments, and don’t have the daily cash flow for the money you are spending. In this instance, you are a prime candidate. And if you are consistently behind in making your payments, then again this would be a wise decision.

How do you pick the right company?

It can sometimes be confusing when examining the different debt relief programs and companies. When comparing your debt relief options, there are several important features you should consider.

Here are three guaranteed ways to help you find the most effective firm:

1) Make sure they are accredited

This basically just states that they have the necessary credentials to deal with your case. If a company has this, you know they are legit. They should be part of the NFCC or AICCCA.

The reality is that there are a lot of scammers in this industry who just take your money and are never heard from again. But you know that if a company has gone to the trouble of getting this accreditation, they are the real deal.

2) Read online reviews

There’s no better way to tell how honest a company is than to see what their current and past customers are saying about them. This is particularly necessary if it’s a firm you’ve never heard of.

3) Look at their upfront charges   

Just make sure you avoid companies that require huge initial fees. Most legit firms charge nothing more than ten dollars for an initial consultation, so if it’s much more then avoid them.

When don’t you need a counsellor?

If you can pay all your bills comfortably, but just want better interest rates. In this instance, there is absolutely no reason for you to hire someone.

So this means you can’t get lower rates?

Not at all. Just negotiate directly with the company you are paying. If they won’t budge, let them know you will go with another company if they don’t come up with something better.

The bottom line: A credit counsellor may not be worth the cost for many people. But if you are drowning in debt, then it may be a sensible option.


About Karen

Karen Karsten, CPCC, CAC, has had several business careers, in government, finance, retail and publishing. Each career was a building block that helped her create the life she has now as a coach, writer and executive director of Rich Chicks and Creative Principle of Think You Can LLC.

Her companies, Think You Can ( and Rich Chicks ( both explore the magic of prosperity and creating clarity about life values. Karen has total faith in the magic of belief. Notice how that works either way: belief of magic, magic of belief. Magic is there—in you, too. Take a moment right now and honor the magic in you.

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