Oct 27, 2017

Whether you need to manage your debt or create a budget, a credit counselor can help you take charge of your finances. 

Though some are more qualified than others, a credit counselor can work with you to help manage your finances.

Consider the following ways to select a reputable and knowledgeable credit counselor who can not only prevent mistakes you’ve made in the past, but empower you to maintain your own financial affairs:

1. Decide what you want and where to locate it

Get your financial woes and intentions out on paper prior to contacting a credit counselor. 

Certified credit counselors, for the most part, can provide free budgeting advice. Those with specialized training are likely to charge a fee for specific consultations about debt management, buying a home, student loan management or bankruptcy advice.

There are two ways to locate a credit counselor:

·       The country’s largest non-profit counseling organization is the National Foundation for Credit Counseling. They can help you find a nearby counselor who can help you manage your specific financial situation. The “Ask an Advisor” system offered by NerdWallet can connect you with a nearby NFCC member agency.

·       The U.S. Department of Justice also helps people locate credit counselors within their area with their own search tool. Their agencies are vetted by the federal government, and can provide alternatives for people considering declaring bankruptcy.

Such credit counseling services can help people obtain trustworthy financial advice over the phone, though it may be limited and less personalized, should a credit counselor not be within their region.

2. Review qualifications

Quality advice can be obtained from certified counselors that are a part of the National Foundation for Credit Counseling and the Financial Counseling Association of America.

GreenPath, ClearPoint Credit Counseling Solutions and Money Management International are a few trustworthy credit counseling agencies accredited by the NFCC.

Organizations not affiliated with the FCAA or NFCC should be accredited through the not-for-profit organization called the Council on Accreditation, who can suggest credit counseling agencies to those in need of financial advice.

Check with the Better Business Bureau to make sure the credit counseling agency you may use has a solid reputation.

3. Go Slow

Don’t be in a rush to choose a credit counselor. Investigate the agency you’re considering calling so you can speak with someone who has your best interests at heart.

Don’t be in a hurry and hire the first credit counselor you contact. Be mindful of the following steps when narrowing down the agency you intend to use:

·       Call the credit counselor to set up (what should be a) free meeting, either in person or over the phone.

·       Inquire about the counselor’s qualifications, experience and methods to managing debt. Ask as many questions as necessary to learn how they can help address your specific financial needs.

·       Determine if you’re comfortable with the counselor, or if you’re feeling pressured to sign up for their services.

·       Ensure you understand their approaches and the fees associated with whatever program they offer you.

There are no overnight solutions to credit and debt problems, so be mindful of those who make promises that sound too good to be true. Some credit counseling agencies charge higher fees than non-profit organizations, most of which have short-term programs that may not take your long-term interests into consideration.

Agencies calling themselves “credit doctors” are a prime example. They may dispute negative comments on your credit report, but if the claims are legitimate, you could be right back to where you started after your arrangement with said agency ends.

Next steps

Have patience selecting a credit counselor that can help you with your requirements. Your current financial situation is a result of small decisions made over many years, so be smart in choosing an agency to help you out of your established bind.

Chances are, if you’re pondering whether or not you should use a credit counselor, you probably need one anyways. Professional advice can be beneficial to managing your finances properly, and signing up for a service to learn what your options are isn’t necessary. It’s worth calling a non-profit credit counseling agency to review your budget and learn what your options are.

You can learn a lot from your meeting with an accredited counselor, no matter the state of your financial situation.

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